Pro-Crypto Dove Emerges as Leading Candidate to Succeed Powell

American economist Kevin Hassett is positioning himself as a top contender to become the new chair of the Federal Reserve, a move that could have significant implications for the cryptocurrency market. His background and stance on monetary policy suggest a potentially favorable environment for digital assets.

Key Takeaways

Kevin Hassett is seen as a strong candidate to replace Jerome Powell as Fed Chair.
Hassett's "dove" approach to economics may lead to lower interest rates, benefiting riskier assets like cryptocurrency.
He has experience in digital asset regulation and ties to Coinbase.
Current predictions place Hassett with a 57% chance of nomination, but a decision is not expected soon.
Other candidates include Christopher Waller and Kevin Warsh, with differing views on monetary policy.

Pro-Crypto Dove Emerges as Top Candidate to Replace Powell

The Rise of Kevin Hassett as Fed Chair Candidate

Juan Leon, a senior investment strategist at Bitwise Invest, suggests that if Kevin Hassett becomes the new chair of the Federal Reserve, it would likely be "strongly bullish" for the cryptocurrency market.

Hassett is known for his aggressive "dove" stance, advocating for faster and deeper cuts in interest rates. Typically, lower interest rates make riskier assets, such as cryptocurrencies, more appealing since borrowing costs for leveraging investments are reduced.

In addition to his economic philosophy, Hassett has substantial experience in the realm of digital assets. He previously led a working group aimed at developing cryptocurrency regulations, demonstrating his commitment to shaping the landscape for digital currencies. Furthermore, he has served on the advisory board of Coinbase and holds a significant stake in the company.

As Hassett emerges as a leading frontrunner to take over from Fed Chair Jerome Powell, Polymarket bettors currently estimate a 57% chance of his nomination as the head of the United States' central bank. However, securing this position is not guaranteed.

Expectations indicate that an announcement regarding the next Fed chair may not occur this year. Following Hassett in the running is current Fed governor Christopher Waller, holding a 22% chance. Waller is known for his hawkish views, which may not be beneficial for the crypto sector.

Another notable candidate is Kevin Warsh, a former Fed governor and investment banker with a 15% likelihood of being nominated. Warsh has a solid academic background, being trained at both Yale and Harvard.

The chair of the Federal Reserve serves a four-year term upon confirmation, and Powell's current term, which is his second and final, extends until February 2026.