Warsh Sees End to Bitcoin's 26% August Run

Bitcoin's roughly 26% gain over the past month may be nearing its end, Federal Reserve Chairman Kevin Warsh told global finance chiefs.

He contends the era of cheap money has ended. With growth accelerating, capital is flowing into new ventures, driving interest rates higher rather than lower.

Warsh Declares End of Cheap Money

Warsh has chaired the Federal Reserve for 100 days. He addressed the G20 gathering in Asheville, North Carolina, on Monday, a meeting of finance ministers and central bankers.

Economists had long attributed cheap borrowing to an excess of idle capital and a shortage of viable projects. Warsh now says that situation is over. He presented the same argument at Jackson Hole on Friday.

“It wasn’t so long ago … when economists and policymakers were speaking of secular stagnation and a global saving glut,” said Warsh.

He noted that capital is now flowing heavily into artificial intelligence. He refrained from describing current conditions as tight, with inflation still at an annual rate of 3.7%.

Bessent Argues He Cannot Alter Market Forces

Treasury Secretary Scott Bessent was seated next to Warsh at the Monday event. On August 19, Bessent expanded the Treasury's bond buyback program to at least $4 billion per operation, doubling its previous size. A buyback involves the government repurchasing its own long-term debt.

Critics alleged the real intention was to lower borrowing costs, but Bessent has denied that.

“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,” said Bessent on Monday's panel.

The market, however, has not heeded his words. The 30-year Treasury yield hit approximately 5.26% that same day, a 19-year peak, while the 10-year yield jumped to 4.76%.

Stanley Druckenmiller, who orchestrated the 1992 trade that broke the Bank of England when Britain tried to defend an unsustainable price, sees a parallel. Bessent was at Soros Fund Management at the time. Druckenmiller says he is repeating the mistake.

On Monday, Bessent directly addressed the controversy. He revealed that he and Druckenmiller have talked since the editorial was published, and implied that the timing of the op-ed cost his former mentor money in the markets.

*BESSENT: THINK DRUCKENMILLER LOST MONEY DAY HE SENT EDITORIAL

— tradfi news (@tradfi) August 31, 2026

Implications for Bitcoin Investors

In August, investors turned to hard assets anticipating further dollar depreciation. Warsh outlines a contrasting scenario where stronger growth drives interest rates up, rewarding savers for waiting while bitcoin offers no yield.

After Warsh's Jackson Hole remarks, both gold and bitcoin declined. The greater threat comes from Warsh rather than Bessent, especially with a historically volatile September market pattern on the horizon.