Could Crypto Surge If Kevin Hassett Becomes Fed Chair in 2026?

Kevin Hassett, who currently heads the White House National Economic Council, has quickly become the leading candidate to chair the Federal Reserve, sparking interest among crypto investors. Reports from Bloomberg indicate that Hassett is the preferred choice of President Donald Trump due to his alignment with the desire for lower interest rates. Prior to this, Hassett had previously served as an adviser to Coinbase and holds at least $1 million in Coinbase stocks.

Key Takeaways

Kevin Hassett is the leading candidate for Fed Chair, potentially favoring lower interest rates.
His ties to Coinbase and advocacy for pro-crypto regulations bode well for the crypto market.
The direction of the Fed’s policies under Hassett may significantly influence the future of cryptocurrencies.
Market sentiment indicates a growing confidence in crypto's role in the monetary landscape.

Crypto news Fed chair Hassett

Impact of Hassett on the Crypto Market

For those investing in cryptocurrency, Hassett's combination of a dovish economic stance and his connections to a significant US exchange supports a bullish outlook. Juan Leon, a senior investment strategist at Bitwise, stated plainly on X: “If Kevin Hassett becomes Fed Chair, the implications for crypto are strongly bullish.” He describes Hassett as an "aggressive 'dove'" who has criticized current interest rates as overly high and called for quicker, more substantial rate cuts. Furthermore, Leon points out that Hassett has served on the advisory board of Coinbase and led a White House digital asset working group aimed at fostering regulations favorable to crypto.

Nevertheless, Hassett’s potential influence cannot be considered in isolation from Treasury Secretary Scott Bessent's developing strategy for the Fed. Bessent has raised concerns about the current framework established after the financial crisis. As reported by Walter Bloomberg during his CNBC segment, Bessent indicated that the "ample reserves regime" might be losing its effectiveness.

Felix Jauvin, host of Forward Guidance, summed up the anticipated direction when he stated: "Bessent wants a Fed chair focused on simplifying operations to pre-ample regime levels, blending a dovish Fed Funds Rate with a tighter balance sheet." He elaborated, “I’m not sure how far we are from any form of quantitative easing.”

This distinction is crucial for crypto investors. While a Hassett-led Federal Reserve might implement rapid rate cuts, the question of whether this will lead to an extensive return to quantitative easing remains open. Although a combination of "dovish Fed Funds Rates" and "hawkish balance sheets" could create a more favorable atmosphere than the restrictions seen since 2022, it does not guarantee a resurgence akin to the liquidity surge that benefited risk assets from 2020 to 2021.

Rate reductions without expansive asset purchases can enhance risk appetite and lower discount rates, but they don’t necessarily recreate the extreme market conditions that many crypto investors link to a supportive Federal Reserve.

The political reasoning behind Hassett’s rise has been articulately discussed by macro analyst EndGame Macro (@onechancefreedm). He points out that "Hassett is not rising to power due to being the most academically qualified or the typical central banker. He’s emerging because he aligns with Trump's priorities." According to EndGame, Trump seeks an individual he trusts—someone who has publicly defended him over the years and voiced criticism of the Fed for being overly cautious. In this framework, "the market hears dovish signals, Trump hears a path to renewed growth, and crypto enthusiasts hear one of their own."

Markets are starting to reflect this sentiment. According to Polymarket, contracts tracking the Fed chair race show Hassett with a probability of about 53% at the time of writing, indicating a shift from speculation to a more certain outlook.

Who will Trump nominate as Fed Chair? | Source: Polymarket

Whether this scenario leads to a significant surge in cryptocurrency depends more on how the Fed under Hassett applies its policies, how Scott Bessent adjusts the Fed's balance sheet, and how the market reassesses inflation, term premiums, and fiscal risk in response to a more politically inclined Federal Reserve.

The betting market indicates that cryptocurrency is moving closer to the nexus of US monetary policy. The extent of any developments in 2026 will be shaped by the economic cycle, as well as how a Hassett-led Fed applies "dovish rates" alongside a "hawkish balance sheet."

As of now, the total market capitalization of cryptocurrency stands at $2.96 trillion.

Total crypto market cap remains above the 100-week EMA, 1-week chart | Source: TOTAL on TradingView.com