Trump's Crypto-Friendly Adviser Kevin Hassett Emerges as Leading Fed Chair Contender

Introduction

In a development sending ripples through both traditional finance and the digital asset ecosystem, former President Donald Trump has publicly identified his adviser, Kevin Hassett, as a "potential Fed chair." This remark, made during a White House event on Tuesday, triggered an immediate surge in prediction market odds for Hassett's nomination to lead the Federal Reserve. With current Chair Jerome Powell's term set to expire in May 2026, the prospect of a Fed chair with a known, crypto-friendly background represents a potential paradigm shift for monetary policy and its intersection with the digital economy. This article analyzes Hassett's emergence as a leading contender, his background and policy leanings, and the broader implications for the cryptocurrency market.

The Public Hint and Prediction Market Reaction

The speculation moved from political rumor to tangible market signal following Trump's comments. Speaking at the White House, Trump introduced guests and notably stated, “It’s a great group, and I guess a potential Fed chair is here too... He’s a respected person, that I can tell you. Thank you, Kevin.” This public acknowledgment was compounded by reports from earlier the same day that, during a cabinet meeting, Trump indicated the search had been narrowed significantly: “I think we probably looked at 10 and we have it down to one.”

The reaction on blockchain-based prediction markets was swift and decisive. On Kalshi, the odds for Kevin Hassett to be nominated as chairman of the Federal Reserve jumped to approximately 85%, up from around 66% prior to the comments. A similar pattern was observed on the platform Polymarket. These prediction markets, which aggregate crowd-sourced sentiment on future events, serve as a real-time barometer of perceived likelihood, and the sharp spike indicates that market participants interpreted Trump's words as a strong directional signal.

Kevin Hassett's Profile: From Academic to Crypto-Friendly Adviser

To understand the significance of this potential nomination, one must examine Kevin Hassett's career trajectory and current role. Hassett is an economist with a long history in public policy and academia. He served as a senior economist at the Board of Governors of the Federal Reserve System early in his career and later chaired the White House Council of Economic Advisers under President Trump from 2017 to 2019.

In January 2025, Hassett returned to the administration as the Director of the National Economic Council (NEC). In this role, he oversees the coordination of economic policy across federal agencies. Crucially for the crypto industry, he has also been tasked with overseeing the administration's digital asset working group. His personal financial disclosure revealed a $1 million stake in Coinbase Global Inc., providing a clear, tangible link to the cryptocurrency sector. This combination of high-level economic policy experience and direct exposure to the digital asset market frames him as a unique candidate who understands both traditional macroeconomic levers and the burgeoning crypto economy.

The Strained Relationship with Jerome Powell

Hassett's rise as a potential successor is set against the backdrop of a consistently tense relationship between Trump and incumbent Fed Chair Jerome Powell. Trump has been openly critical of Powell's monetary policy decisions, particularly regarding interest rates. In late November, Trump was quoted saying, “I’d love to fire his ass ... grossly incompetent.” This public friction underscores a desire for a change in leadership and philosophy at the central bank.

The search for Powell's successor is being led by Treasury Secretary Scott Bessent. Bessent has outlined specific criteria for the next chair, stating last month that the administration seeks "a leader who could guide the Fed more quietly behind the scenes." He elaborated, “I think it’s time for the Fed just to move back into the background, like it used to do, calm things down and work for the American people.” This suggests a preference for a less publicly visible and potentially more politically aligned Fed chair compared to Powell's tenure.

Monetary Policy Implications: A Potential Shift on Interest Rates

While the Federal Reserve does not have direct regulatory authority over cryptocurrencies—a purview primarily held by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC)—its monetary policy decisions exert profound influence on global financial market sentiment, including digital assets.

The Fed controls benchmark interest rates, which are a primary tool for managing inflation and economic growth. Historically, lower interest rates have been viewed as conducive to risk-on asset classes like technology stocks and cryptocurrencies. They reduce the yield on traditional safe-haven assets like government bonds, making alternative investments more attractive. They also lower borrowing costs, potentially increasing capital flow into speculative markets.

Kevin Hassett has previously been critical of what he perceived as excessively high interest rate policy from the Fed. If nominated and confirmed, his approach could lean toward a more accommodative or dovish stance compared to recent policy, especially if inflation remains within target ranges. A sustained period of lower rates could create a macroeconomic environment traditionally favorable for crypto asset appreciation.

The Fed's Banking Oversight and Crypto Access

Beyond interest rates, the Federal Reserve plays a critical role in overseeing the U.S. banking system. Its regulations determine how banks interact with various sectors of the economy, including cryptocurrency firms. Policies on capital requirements, risk assessments for banking relationships with crypto companies (often referred to as "Operation Choke Point 2.0" concerns), and the development of central bank digital currencies (CBDCs) all fall under its broad purview.

A Fed chair with an understanding of digital assets could influence how these banking rules are crafted and enforced. This could lead to a more structured and potentially less adversarial relationship between traditional banks and regulated crypto entities, improving access to banking services for legitimate firms—a longstanding hurdle for the industry. The direction of research or policy regarding a U.S. CBDC would also be significantly shaped by the incoming chair's perspective on digital currency architecture and privacy.

Historical Context: Comparing Fed Leadership Transitions

Historical transitions in Fed leadership offer context for potential market impacts. The appointment of a new chair often brings initial market volatility as participants assess the nominee's philosophy. For instance, when Jerome Powell succeeded Janet Yellen in 2018, markets watched closely for signs of continuity or change in the post-financial crisis normalization path.

However, a potential Hassett nomination is distinctive due to the explicit crypto connection. No previous Fed chair candidate has entered consideration with such a publicly disclosed personal investment in a major crypto exchange or direct oversight experience of digital asset policy at the executive level. This breaks new ground and introduces a variable not present in past transitions: a leader whose professional recent history includes formal engagement with crypto policy and personal portfolio exposure to the sector.

Conclusion: A Signal Watched by Markets

The emergence of Kevin Hassett as a leading contender for Federal Reserve chair is more than routine political speculation; it is a development with concrete implications for monetary policy direction and its intersection with digital finance. The dramatic shift in prediction market odds following Trump's comments reflects markets' acute sensitivity to this possibility.

For participants in the cryptocurrency market, this signals a potential future where the world's most influential central bank is led by an individual familiar with digital assets. While this does not equate to direct regulatory relief from agencies like the SEC, it suggests a higher likelihood of monetary policy sympathetic to risk assets and potentially more open channels between crypto enterprises and the regulated banking system overseen by the Fed.

What readers should watch next: The formal nomination process will be key. Observers should monitor official announcements from President Trump or Treasury Secretary Bessent regarding nominee selection. Confirmation hearings before the Senate Banking Committee will provide critical insights into Hassett's detailed views on inflation targeting, balance sheet policy, bank regulation concerning crypto, and CBDCs. Furthermore, continued tracking of prediction markets like Kalshi and Polymarket will offer real-time sentiment on his confirmation odds as political dynamics evolve.

The broader takeaway is that cryptocurrency is increasingly intertwined with mainstream fiscal and monetary policy discussions. The prospect of a "crypto-friendly" Fed chair marks another step in that maturation process, highlighting how digital assets are now factored into high-stakes decisions at the very core of global economic governance