It is unclear when President Trump will name a new Federal Reserve chairman.
The current chairman, Jerome Powell, is scheduled to end his term in May 2026, according to US Treasury Secretary Scott Bessent, and President Trump is reportedly preparing to announce his successor soon.
summary
- President Trump is expected to announce a successor to Jerome Powell before Christmas, accelerating uncertainty over future Federal Reserve policy.
- Bitcoin and the broader market are reacting to interest rate cut expectations and President Trump's pro-crypto stance, with analysts pointing to a strong historical correlation between the Fed's decisions and crypto performance.
- Kevin Hassett has emerged as a leading candidate to chair the Federal Reserve, raising questions about how a potentially crypto-friendly central bank leader will shape monetary policy.
“It's very likely that the president will make an announcement before Christmas,” Bessent said on Nov. 25.
Five days later, President Trump said it was his choice. By Dec. 2, the New York Times reported that President Trump said an announcement could be “early next year.”
Meanwhile, Bitcoin continues to show a historical correlation with the Federal Reserve's interest rate policy, with prices typically falling during rate hikes and rising during rate cuts.
And according to a 60 Minutes interview with President Trump on November 2nd, cryptocurrencies are a top concern for the president.
“I only care about one thing: Will cryptocurrencies become number one in America?” Trump said. “Because the crypto industry is the kind of industry where you're basically going to get number one, but you're not going to get number two.”
In any case, crypto bulls are likely to be watching with bated breath. A new Fed chair candidate could signal a shift toward more favorable monetary policy.
Historically, lower interest rates have boosted the price of cryptocurrencies by increasing market liquidity and reducing borrowing costs. Once Powell's term ends, a new candidate could reduce policy uncertainty and advocate lower interest rates, which is typically bullish for cryptocurrencies.
Moreover, Trump's past support for cryptocurrencies suggests that the new chairman could create a more favorable regulatory environment for digital assets. Still, Bitcoin is still in the red, even though cryptocurrency regulations in 2025 are very lenient. See below.
Source: CoinGecko
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Who are the finalists?
- Kevin Hassett, director of the National Economic Council of the United States, is seen as a leading candidate for the position of Fed chairman. Hassett previously served on the White House Economic Council and has been characterized in some media as having a positive view of cryptocurrencies, but his potential policy direction as Fed chair remains uncertain.
- Another candidate is Federal Reserve Board member Christopher Waller, known for his hawkish monetary policy stance and emphasis on curbing inflation.
- Federal Reserve Vice Chair Michelle Bowman and BlackRock executive Rick Rieder are also candidates.
What's next?
A 25 basis point rate cut is expected at the Fed's Dec. 10 meeting, but analysts warn that the real driver of the market will be the Fed's economic forecast and Chairman Powell's remarks.
Although the cuts are widely expected, they may face opposition from hawkish officials, looming at the risk of a “hawkish cut.” The Fed is nearing the end of its easing cycle and could pivot to a slower, more cautious approach.
Market volatility is expected due to growing disagreements within the Fed, weak guidance, and uncertainty about future policy moves.
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