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Federal Reserve Chair Kevin Warsh has made it clear that the US central bank will not step in to rescue cryptocurrency or stablecoin firms during a future market crisis, drawing a sharp line between reducing systemic risks and bailing out private companies.
Speaking before the House Financial Services Committee during the Federal Reserve’s Semi-Annual Monetary Policy Report, Warsh said the lessons of the 2008 financial crisis continue to shape the Fed’s approach to financial stability.
His comments come as stablecoins become increasingly integrated into the financial system following the passage of the GENIUS Act and as regulators work to finalize rules governing the sector.
The issue arose during questioning from Representative Brad Sherman (D-Calif.), a longtime cryptocurrency critic, who asked whether the Federal Reserve would establish emergency liquidity facilities for stablecoins or crypto markets in the event of a large-scale run similar to the support provided to money market funds during the 2008 financial crisis.
Warsh responded by recalling his experience during the financial crisis, when he served as a Federal Reserve governor.
“I still have the scars from the 2008 financial crisis,” Warsh told lawmakers. “That is not something we want to repeat.”
He then delivered one of the clearest statements yet on the Fed’s position toward digital asset rescues.
“We do not want to be in the bailout business. Full stop.”
Warsh stopped short of discussing hypothetical emergency facilities but reiterated that the Fed’s objective is to prevent systemic risks from emerging rather than rescue individual firms.
“We’re going to do everything we can to mitigate those sorts of extraordinary risks,” he said. “We want to be in a position where we’re not bailing out anybody, including crypto.”
Lawmakers also questioned Warsh about implementation of the GENIUS Act, the federal stablecoin law signed last year.
Bryan Steil (R-Wis.) asked whether the Federal Reserve would meet the upcoming deadline for publishing banking regulations required under the legislation.
💥BREAKING: 🇺🇸 The NEW FED CHAIR Kevin Warsh just confirmed the GENIUS ACT will be fully implemented across US BANKS in days:
"We are racing to put that out by this DEADLINE this SATURDAY." 🔥
The GENIUS ACT is the first crypto bill in US history. Trump is also prepared to sign… pic.twitter.com/sFUN9uVsE0
— JackTheRippler ©️ (@RippleXrpie) July 15, 2026
Warsh avoided committing to a specific timeline but emphasized that the Fed intends to coordinate closely with other banking regulators before issuing proposed rules.
“I think rulemakings from the bank regulators are best when we have a family fight between and among us,” he said, explaining that regulators aim to publish coordinated proposals rather than conflicting frameworks.
Beyond digital assets, much of the hearing focused on inflation and financial regulation.
Warsh described inflation as “a choice” rather than an unavoidable outcome, stressing that the Federal Open Market Committee remains committed to restoring price stability after holding interest rates at its June meeting.
He also defended the Federal Reserve’s independence and announced that five internal task forces have been established to review subjects ranging from monetary policy communications and balance sheet management to artificial intelligence, productivity and inflation modeling.
Digital assets surfaced again during questioning over so-called “Operation Choke Point 2.0,” with Representative Barry Loudermilk (R-Ga.) asking whether regulators would continue using reputational risk to discourage banks from serving crypto companies.
Warsh said the Federal Reserve has already removed reputational risk from supervisory guidance.
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