Trump's Fed Nominee Warsh's Crypto Ties Raise Questions Over Stablecoin's 'Made in America' Push
President Donald Trump's nomination of Kevin Warsh to chair the Federal Reserve has cast a spotlight on the nominee's deep connections to the cryptocurrency sector, particularly his advisory role with a firm central to Tether's launch of a U.S.-regulated stablecoin.
Warsh, a former Federal Reserve governor, served for years as an advisor to Anchorage Digital Bank. The firm is the issuer of USAT, a new dollar-pegged stablecoin that Tether launched last week with a declared "Made in America" compliance focus. Archives show Warsh was listed on Anchorage's website as an advisor until at least mid-January, though his profile was removed following his nomination last Friday.
"Kevin has been an advisor to Anchorage since the very beginning," Anchorage Digital CEO Nathan McCauley stated on social platform X, expressing strong support for the nomination. An Anchorage spokesperson later added, "We are grateful to Kevin Warsh for his counsel over many years and wish him the best throughout the confirmation process."
The nomination arrives amid heightened scrutiny over the Fed's independence. Trump has repeatedly clashed with current Chair Jerome Powell over interest rate policy, tensions that escalated recently with a reported Justice Department probe into Powell. Warsh's potential ascent places a figure with direct ties to a regulated crypto bank at the helm of the institution that would oversee such entities.
Analysts note the link creates a complex web. Anchorage Digital, which became the first federally chartered crypto bank in the U.S., now issues a stablecoin designed to comply with new federal regulations passed this summer. Furthermore, Cantor Fitzgerald—the investment bank led until recently by Trump's Commerce Secretary nominee Howard Lutnick—is the designated custodian for USAT's reserves. This situates Warsh's former advisory firm at the nexus of a stablecoin project involving another key Trump appointee's former company.
While Tether's flagship USDT is backed partly by assets like Bitcoin and gold—a structure not fully aligned with the new U.S. rules—the company insists USAT will operate within the regulatory framework. The stablecoin's infrastructure relies on a bank that Warsh advised, raising questions about perceived conflicts should he be confirmed.
Trump expressed confidence over the weekend that Warsh, whom he called a "high-quality person," would secure Senate confirmation, potentially with bipartisan support.
Voices from the Industry:
"This isn't just a revolving door; it's a wide-open gateway," says Maya Chen, a fintech policy analyst at the Brookings Institute. "Having a Fed chair nominee who helped shape a key issuer in the largest stablecoin ecosystem fundamentally challenges the arm's-length relationship regulators are supposed to maintain. It signals a regulatory capture that the crypto industry has long sought."
David Park, a portfolio manager at Clearwater Capital, offers a more measured view: "Warsh's experience with the institutional side of digital assets could be a net positive. It brings much-needed expertise to the Fed as it grapples with integrating crypto into the financial system. The key will be full transparency and appropriate recusals during his tenure."
"It's outrageous and shows blatant cronyism," argues Rebecca Vance, founder of the consumer advocacy group Financial Transparency Now. "The same person who helped a crypto bank get off the ground could now be writing the rules for it. This nomination makes a mockery of the Fed's independence and puts the interests of a speculative industry over those of everyday Americans."
Michael Torres, CEO of a competing stablecoin project, sees strategic maneuvering: "Tether's 'Made in America' pivot through Anchorage, with its links to Warsh and Cantor, is a masterclass in regulatory arbitrage. They're not just entering the U.S. market; they're aligning themselves with the likely future architects of its policy."