US President Donald Trump on Wednesday formally nominated pro-bitcoin candidate Kevin Warsh to the US Senate, kicking off a process that could replace Jerome Powell when his term ends in May.
Reports say the White House has filed paperwork to appoint Warsh as president for four years and as governor for a longer term at the central bank.
The candidate was sent to the Senate
According to several media reports, the nomination will now be referred to the Senate Banking Committee for consideration. The committee decides whether to hold a hearing and then send the nominee’s nomination to the full Senate for a confirmation vote.
Time is uncertain. Some senators have already indicated they may slow the process until a separate Justice Department investigation is resolved.
Bitcoin Pros: Warsh’s Record and View
Warsh previously served in the Fed. Reports state that he has spoken openly about Bitcoin, calling it a sort of “new gold” for young investors and saying it doesn’t bother him.
When the promotion was announced earlier, markets reacted quickly: Bitcoin rose above the $70,000 level at the time of writing and some short positions were liquidated as traders digested the news.
Warsh’s background combines public service and private finance. He was on the Federation Council during the turmoil and later worked in the private sector and at a policy think tank. That mix is part of what makes him attractive to some senators who support lower rates and worrisome to others who worry about the Fed’s independence.
How markets read movement
Reports say traders see a Fed chairman favoring a rate cut in riskier assets. Bitcoin’s price swings reflected that sentiment in the hours after the proposal reached the Senate.
Some analysts warned that a faster policy shift would depend on data rather than headlines, and that inflation and global events would complicate any easy return to lower borrowing costs.
There are political obstacles ahead
The opposition is already forming. A Republican member of the Banking Committee said he could block nominations pending an outside investigation, and leading Democrats expressed concern about Warsh’s ties to the administration.
Those objections mean a flat confirmation, even with a friendly Senate majority, is far from certain.
Reports state that the next formal steps are commission hearings, written questionnaires and witness testimony. The committee can vote to nominate Warsh, or it can withhold the nomination.
If the committee confirms him, then the full Senate will consider the matter. If the hearing continues, senators will ask about his views on inflation, interest rates and the role of cryptocurrencies in financial stability.
Featured image from Unsplash, chart from TradingView
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