TechFlow News: On January 30, according to CoinDesk, Bitcoin extended its decline—reaching a low near $81,000—as the probability of Kevin Warsh becoming the next Federal Reserve Chair surged in prediction markets. Markus Thielen, founder of 10x Research, noted that markets broadly view Warsh’s renewed policy influence as bearish for Bitcoin. This is because Warsh has long emphasized monetary discipline, higher real interest rates, and tighter liquidity. His policy framework tends to treat crypto assets as “speculative products of an accommodative monetary environment,” rather than hedges against currency depreciation.
Higher real interest rates mean that the true cost of financing rises after adjusting for inflation, typically dampening demand for risk assets—including Bitcoin. Moreover, several observers argue that a hawkish stance coupled with underestimating deflationary risks may have exacerbated economic downturn pressures in the past. Adopting a similar approach today could lead to higher unemployment, slower recovery, and heightened deflationary risks.
