Kevin Warsh, the nominee to lead the Federal Reserve, has submitted his financial disclosure, revealing a vast portfolio with significant cryptocurrency and blockchain holdings. The 69-page document, filed with the US Office of Government Ethics, discloses combined assets with his wife valued at over $192 million. Notably, Warsh's investments include stakes in DeFi protocols, Ethereum scaling networks, a Bitcoin Lightning startup, and prediction markets, all of which he has promised to divest. The disclosure has sparked interest in the crypto industry, given Warsh's future role in overseeing stablecoin regulation, bank crypto custody policy, and potential central bank digital currency decisions.
Warsh's crypto holdings are primarily 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. His portfolio includes investments in DeFi and trading protocols, Layer 1 and Layer 2 networks, Bitcoin-specific companies, crypto investment and financial infrastructure, as well as Web3, NFTs, and crypto-adjacent firms. While most of these positions are reported as being worth less than $1,000, Warsh also holds larger stakes in funds with opaque underlying assets, which 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 disclosure has also raised questions about potential conflicts of interest, given Warsh's deliberate pursuit of exposure to specific protocols, networks, and infrastructure companies that the Fed's regulatory and monetary policy decisions will directly affect. As the Senate Banking Committee prepares for Warsh's confirmation hearing, the crypto holdings are likely to be a topic of discussion, with senators on both sides increasingly focused on financial conflicts at the Fed.