Warsh Warns: Cheap Money May Be Over for Bitcoin

Bitcoin gained around 26% in August, but Federal Reserve Chairman Kevin Warsh believes this upward trend may be coming to an end.

Warsh argued that cheap money is no longer available, as growth is picking up and investors are chasing new projects. This, he claims, will push interest rates up, not down.

In a speech at the Group of 20 (G20) meeting in Asheville, North Carolina, Warsh stated that 'it wasn't so long ago... when economists and policymakers were speaking of secular stagnation and a global saving glut.' He also pointed out that money is now pouring into artificial intelligence.

Treasury Secretary Scott Bessent has been criticized for doubling the size of Treasury's bond buybacks, with some suggesting it was to push borrowing costs down. However, Bessent denies this, stating 'I don't think I can change the equilibrium price. My job is to slow things down... and make sure that the market doesn’t get disorderly.'

Despite Warsh and Bessent's views, investors have been buying hard assets, including Bitcoin, as they expect the dollar to lose value.