At the latest congressional hearing, Federal Reserve Chairman Kevin Warsh stated that the Fed would not provide emergency support to encryption companies during the financial crisis. He said that central banks should focus more on reducing systemic risks than on providing relief when problems erupted.

Explicitly object to encrypted rescue

Warsh stated to parliamentarians that the Fed did not want to play the role of “helper” in any industry, nor was the encryption industry. He said that the goal of the Fed was to avoid a situation in which market participants had to be rescued, rather than to become involved at the bottom of a crisis.

This statement sends a clear signal that, even if digital assets have entered the United States financial system, firms should not expect official support similar to that of the traditional financial crisis.

Reiterating its opposition to the United States CBDC

Warsh stated at the Senate confirmation hearing in April this year that encrypted assets should not remain outside the financial system, but should be seen as part of modern finance. He claimed that digital assets had become part of the financial services industry in the United States.

At the same time, however, he opposed the introduction of a central bank digital currency in the United States. Warsh argued that the creation of the United States CBDC was the wrong policy choice. This position is in line with the views expressed by the majority of Republican parliamentarians.

Inflation and AI received attention

Another focus of the hearing was inflation and the economy as a whole. Warsh states that inflation-resistant tasks should not be determined to have been completed by June alone. Bringing inflation back to the Fed's 2% target remains the central bank's top priority.

In addition to monetary policy, he addressed technical issues. Warsh is optimistic about the future of artificial intelligence and believes that the current AI cycle is expected to increase productivity in the United States. At the same time, he reminded the United States of the need to keep up with rapid quantum calculations.