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There has been a big change in President Donald Trump’s hunt for a new Federal Reserve Chair. Kevin Hassett, who is the Director of the White House National Economic Council, is now the clear front-runner.
Trump introduced Hassett at a White House event on December 2, 2025, with a teasing remark: “It’s a great group, and I guess a potential Fed chair is here too.” He then said, “I don’t know if we’re allowed to say that, potential? He’s a respected person that I can tell you. Thank you, Kevin.” This cryptic nod, reported by France 24 and Bloomberg, has sent prediction markets into overdrive, with Kalshi odds surging to 79% for Hassett’s nomination—up from 40% just days ago.
Hassett’s rise came after Trump’s cabinet meeting that day, which left only one candidate. The president’s plan is to reveal Powell’s replacement “probably early next year.” Powell’s tenure ends in May 2026. Trump appointed Powell in 2018 during his first term. Trump has been angry with Powell over interest rate policies and even thought about firing him. A Hassett-led Fed might mean a more accommodating approach for the crypto industry, which could speed up rate decreases and add liquidity to risky assets like Bitcoin and Ethereum.
Hassett’s Background and Views on Policy
Kevin Hassett knows a lot about economics. He was a PhD economist who had worked as a policy advisor before. During Trump’s first term, he was the head of the Council of Economic Advisers, where he focused on tax cuts and deregulation that helped the economy thrive but also made the deficits bigger. As NEC Director since January 2025, Hassett has been in charge of Trump’s economic plan, pushing for low rates to encourage investment. He said in a CBS “Face the Nation” interview on December 1 that he was open to the idea: “I’m really honored to be among a group of really great candidates.”
Hassett’s opinions are very different from Powell’s cautious ones. He has said that high rates are too stringent and that the Fed should put jobs ahead of inflation hawks in a speech in September. If Hassett is chosen, he might press for faster cuts—maybe 50 basis points in 2026—to fit with Trump’s desire for low borrowing costs. Kalshi’s prediction markets now give him a 79% chance of winning, far ahead of competitors like Kevin Warsh (13%) and existing governors Christopher Waller and Michelle Bowman.
Trump’s process, which is being headed by Treasury Secretary Scott Bessent, has narrowed down to 10 finalists. On CNBC on December 3, Bessent hinted at a surprise before Christmas but reiterated that Hassett was in the lead. He remarked, “There’s a very good chance Trump will make an announcement before the holidays.” If Hassett becomes president, there are rumors that Bessent could also be the senior economic adviser.
Compare with Powell’s Time in Office
Powell has been able to steer the economy through crises during the past eight years. For example, COVID-era QE raised the balance sheet to $9 trillion, and 2022-2023 hikes brought inflation down from 9% to 3%. But his independence didn’t fit with Trump’s wish for reduced prices, which led to public fights and threats of firing. Powell’s term ends in May 2026, and he plans to work full-time, but the political climate suggests otherwise.
Critics are worried that Hassett’s devotion to Trump could hurt the Fed’s independence. In an Axios article from December 1, experts warned of “incremental independence reduction,” which reminded them of the pressure Trump put on them during his first term. Hassett’s pro-market stance—supporting policies that encourage growth—may speed up cutbacks, but it might also make the central bank more political. Forbes said on December 1 that “Hassett’s appointment would mark a closer presidential tie than any modern Fed chair.”
Possible Effects on Crypto Markets
The Fed doesn’t directly control crypto, but its rules have a big effect on mood and liquidity. The dollar is getting weaker (DXY down 8% YTD) because of lower interest rates. This sends money to riskier assets like Bitcoin, which does well when people talk about how the dollar is losing value. Hassett’s dovish lean might speed up cuts in 2026, which would push BTC up to $150,000, which is JPMorgan’s year-end target of $165,000.
A Hassett Fed means this for crypto:
- Easier liquidity: A quicker end to QT might add $500 billion to the market, like in the bull run of 2020.
- Access to Banking: Less strict rules would make it easier for crypto companies to “debank,” as what happened to Binance in 2023.
- Stablecoin Growth: A friendly policy helps the $300B market, which helps Tether and Circle.
The Kalshi odds for “crypto bill by 2026” surpassed 85%, which shows that people are hopeful. But there are risks, including inflation going up because of tariffs, which might make cuts take longer.
conclusion
Trump’s December 2 indication that Kevin Hassett would be the next Fed Chair (79% Kalshi chances) shows that he is moving toward a dovish stance, which is different from Powell’s cautious approach and might make crypto even more popular with faster cuts and more liquidity.
As Bessent gets ready to make an announcement before the holidays, the market gets ready for policy changes that could raise BTC to $150,000. For digital assets, it’s a good thing that the market cap is $4 trillion, but the risk of politicized rates is that independence may erode. Watch May 2026: Hassett’s confirmation could change the way money and crypto are linked.
