The financial disclosure filing of Kevin Warsh, the nominee for Federal Reserve chair, has shed light on his extensive investment portfolio, including significant holdings in cryptocurrency and blockchain companies. With combined assets valued at over $192 million, Warsh's investments span a wide range of crypto-specific companies, including DeFi lending protocols, decentralized derivatives, Layer 1 and Layer 2 networks, prediction markets, and Bitcoin payments infrastructure. Notably, he has pledged to divest most of these holdings. The revelation has sparked interest and concern, given Warsh's potential role in overseeing stablecoin regulation, bank crypto custody policy, and central bank digital currency decisions.
His personal investment in the crypto ecosystem, although the size of the holdings was previously unclear, has raised questions about potential conflicts of interest. The investments are concentrated in two fund structures: DCM Investments 10 LLC and a series of funds labeled AVF I, AVF II, AVF III, and AVGF I and II. Warsh's crypto and blockchain-related holdings include positions in DeFi and trading protocols, Layer 1 and Layer 2 networks, Bitcoin-specific companies, crypto investment and financial infrastructure, and Web3, NFTs, and crypto-adjacent companies. While most of these positions are small venture bets, there are larger, opaque holdings that will require full divestiture.
The mandatory divestiture and recusal obligations may constrain Warsh's ability to act on his sympathies towards the crypto industry, at least in the first year. The Senate Banking Committee is expected to hold a confirmation hearing next week, where Warsh's crypto holdings will likely be a topic of discussion.