Brad

Chair

Kevin

FIFA

Reserve

Federal Reserve Chair Kevin Warsh sent a stark warning on bailouts during a testimony on July 14.
Warsh <a href="https://www.youtube.com/watch?v=ZO9HbvGe7cE" rel="noopener noreferrer nofollow">appeared</a> before the&nbsp;House Financial Services Committee for the Fed's semi-annual monetary policy report on Tuesday and repeatedly said the central bank doesn't want to bail out failing companies, including those belonging to the crypto industry.
<figure><img src="https://www.thestreet.com/.image/c_fit%2Ch_675%2Cw_1200/MjI0NzgwODg4NzEyNDg4OTI0/us-federal-reserve-chair-kevin-warsh-testifies-during-a-house-financial-services-committee-hearing-titled-the-federal-reserves-semi-annual-monetary-policy-report-on-capitol-hill-in-washington-dc-on-ju.jpg" height="675" width="1013">
 <figcaption>
 U.S. Federal Reserve Chair Kevin Warsh testifies during a House Financial Services Committee hearing titled "The Federal Reserve's Semi-Annual Monetary Policy Report" on Capitol Hill in Washington, DC, on July 14, 2026. 
 Getty Images
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<h2 id="feddoesn-t-want-to-be-in-bailout-business-warsh-says">Fed&nbsp;doesn't want to be in bailout business, Warsh says</h2>
During the testimony,&nbsp;Rep. Brad Sherman (D-CA-32) asked Warsh if the central bank would come forward to bail out failed cryptocurrency companies the way it rescued money market funds during the 2008 global financial crisis.
In no uncertain terms, Warsh denied any possibility of the Fed bailing out crypto firms if they fail.
<blockquote>
 “We do not want to be in the bailout business, full stop.”
</blockquote>
The Fed chair also reminded the lawmakers of his own history with the 2008 financial crisis.
<blockquote>
 “I still have the scars from the 2008 financial crisis,” he said. “We all carry the scars from the extraordinary efforts that my colleagues and I undertook under Chairman Bernanke’s leadership. That is not something we want to repeat.”
</blockquote>
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<h2 id="no-bailout-for-crypto-firms-warsh-reiterates">No bailout for crypto firms, Warsh reiterates</h2>
Sherman, popular for his deeply skeptical stance vis-à-vis digital assets, pressed further and asked Warsh if the Fed will step in to bail out crypto firms, similar to its actions after the 2008 crisis.
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 Representative Brad Sherman, a Democrat from California, during a House Financial Services Committee hearing in Washington, DC, US, on Tuesday, Dec. 2, 2025. 
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Warsh said the bank will&nbsp;do everything in its capacity to mitigate "extraordinary" risks if and when they arise over the next four years. But he reiterated his stance regarding bailouts.
<blockquote>
 “We want to be in a position where we’re not bailing out anybody, including crypto.”
</blockquote>
Warsh's remarks show that while the Fed is not opposed to crypto assets, the industry needs to stand on its feet as the central bank isn't inclined to bail them out if they fail.
<a href="https://www.thestreet.com/crypto/markets/trumps-fed-pick-discloses-holdings-in-musks-spacex-polymarket-and-solana" rel="noopener noreferrer nofollow">Related: Trump's Fed pick discloses holdings in Musk's SpaceX, Polymarket, and Solana</a>

Fed's Kevin Warsh issues stark warning on 2008-style bailouts

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