Warsh’s Fed Swear‑in Sets Stage for Crypto Crash-Markets Shirking Rate Cuts!

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Kevin Warsh Fed swearing-in tests fading rate-cut hopes

Kevin Warsh is expected to become the next head of the Federal Reserve, as investors now anticipate fewer interest rate cuts at the upcoming policy meeting.

Summary

  • Kevin Warsh enters the Fed as traders sharply cut expectations for 2026 rate relief ahead.
  • CME and Kalshi data show markets now expect rates to stay higher for longer ahead.
  • CFTC staffing worries grow as CLARITY Act could expand crypto oversight before new appointments arrive.

Jerome Powell will continue to serve on the Federal Reserve’s Board of Governors, but Michael Warsh is taking over as chair after being confirmed by the Senate with a vote of 54 to 45. The swearing-in ceremony is scheduled for Friday.

Kevin Warsh is taking on his new position at a challenging moment for the Federal Reserve. While President Trump has consistently urged the Fed to cut interest rates, current market expectations suggest this is unlikely to happen soon. According to Reuters, Warsh will need to navigate rising inflation, disagreements within the Fed, and a crucial June meeting that will likely reveal his initial approach to policy.

Fed rate-cut odds fade before June meeting

Expectations for interest rate cuts have shifted quickly. According to Kalshi, there’s now only a 38.2% chance of a rate cut happening before 2027, a significant drop from 96% in February. CME FedWatch data indicates a 98.8% probability that rates will remain unchanged through June, and over a 94% chance they’ll stay the same through July. CME explains that FedWatch uses 30-day Fed Funds futures to estimate these rate probabilities.

As a researcher following the Federal Reserve, I’m watching the upcoming FOMC meeting scheduled for June 16th and 17th closely. What makes this meeting particularly interesting is that it includes the release of the Summary of Economic Projections. This report will likely require Kevin Warsh to publicly state his views on the future direction of interest rates, offering valuable insight into his policy stance.

For Bitcoin and other cryptocurrencies, what’s happening in the financial markets is important. Rising interest rates can reduce the amount of money available, which impacts the crypto market. Recently, crypto.news reported that Treasury yields were already increasing, reaching around 5.07% for the 30-year yield and 4.53% for the 10-year yield.

Crypto markets watch Fed independence concerns

The appointment of Warsh has sparked concerns about whether the Federal Reserve will remain independent. During his Senate confirmation hearing, Senator Elizabeth Warren cautioned that a Fed influenced by Trump could potentially favor his family’s cryptocurrency business or offer financial assistance to his Wall Street associates during times of crisis.

Those comments suggested a connection between the change in Federal Reserve leadership and broader concerns about cryptocurrency regulation. crypto.news has been following the story of Jeremy Warsh for months, covering his appointment, how the market reacted when Trump nominated him, and the impact of sustained high interest rates on Bitcoin and other investments considered risky.

CFTC vacancies add another crypto policy test

The Federal Reserve’s change in direction happens as members of Congress urge President Trump to appoint people to vacant positions at the Commodity Futures Trading Commission. On May 15th, the leaders of the House Agriculture Committee, Glenn Thompson and Angie Craig, wrote to the president requesting nominations for a complete, non-partisan group.

The letter highlighted several pressing challenges for the CFTC, such as fluctuating markets, emerging technologies, and potential oversight of spot digital commodities as outlined in the CLARITY Act. The lawmakers emphasized that a complete, five-member commission would allow the agency to operate most effectively.

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2026-05-19 10:03