Five potential candidates to replace Jerome Powell as chairman of the Federal Reserve — and in a bullish development, all of them are pro-crypto.
Treasury Secretary Scott Bessent revealed second round interviews are about to begin, meaning a final decision could be made by the end of the year.
First up is Christopher Waller, who has likened Bitcoin to “electronic gold” — and argued that stablecoins have the potential to boost competition and reduce costs.
In recent weeks, he’s also called for crypto firms to be given direct access to the Fed’s payment infrastructure, meaning they would no longer need to go through banks.
The Fed governor declared: “This is a new era for the Federal Reserve in payments — the DeFi industry is not viewed with suspicion or scorn.”
Waller’s argument basically boils down to this: digital assets are no longer on the sidelines, and “increasingly are woven into the fabric of payment and financial systems”.
Next on the shortlist is the Fed’s current vice chair Michelle Bowman, who has warned regulators shouldn’t adopt an “overly cautious mindset” when it comes to crypto.
Over the summer, she argued that staff at the US central bank should be given permission to own a small amount of digital assets so they can understand how it works, adding:
“I certainly wouldn’t trust someone to teach me to ski if they’d never put on skis, regardless of how many books and articles they have read, or even wrote, about it.”
For Bitcoiners, there is little doubt that this is a refreshing perspective. Over many years now, they have long argued that skeptics simply haven’t taken enough time to understand how this technology works.
Also in the running to be the next Fed chair is Kevin Warsh, whose attitudes toward digital assets are a little more nuanced.
At one point, he was a contender to be treasury secretary in Trump’s second term, a role that ultimately went to Bessent.
Warsh has been an early investor in several prominent crypto firms – including the former algorithmic stablecoin Basis, and the asset manager Bitwise.
While enthusiastic about BTC as a sustainable store of value, he has dismissed the notion that the world’s biggest cryptocurrency could one day unseat the dollar. Penning an opinion piece in the Wall Street Journal back in 2018, he wrote:
“Bitcoin’s price volatility significantly diminishes its usefulness as a reliable unit of account or an effective means of payment.”
Of the five names put forward by Bessent, Warsh would probably be the least favorite in crypto circles — and this is primarily linked to his enthusiasm for central bank digital currencies. While he argues that a digital dollar could strengthen the greenback’s standing on the global stage, cynics argue it could erode privacy and be used to monitor how everyday Americans spend their money.
Others on the shortlist haven’t been afraid to put their money where their mouth is. One of them is Kevin Hassett — a top economic official in the Trump administration — who holds a stake in Coinbase that could be worth up to $5 million.
Hassett currently serves as director of the National Economic Council and hit headlines on October 20 with a CNBC interview where he predicted that the government shutdown would be over within a week. Eight days on though, and it looks like Democrats and Republicans are nowhere close to ending their stalemate — with Trump now on a six-day tour of Asia that will take him through three countries.
Rounding off the list is Rick Rieder, who’s currently BlackRock’s chief investment officer of global fixed income. It won’t be lost on you that this company is now a huge player in the crypto space, not least because of its dominance in Bitcoin ETFs.
He’s gone on the record as saying that BTC is an ideal addition to investment portfolios — and over recent years, has argued that this digital asset is a powerful tool for diversification and hedging against inflation. And while he believes Bitcoin has the potential to rise significantly in the years ahead, Rieder has cast doubt on whether it can fix the world’s monetary problems.
Unless a last-minute entrant enters the race, the next Fed chair will be an ardent supporter of the crypto industry. And given Trump’s displeasure with Powell over a lack of interest rate cuts, it’s clear the White House will be looking for a candidate who will be more aggressive in slashing the cost of borrowing. Cheaper money could be bullish for Bitcoin in the long run.
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