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Fed Faces Crypto Dilemma: Cautious Leadership Amid Regulatory Uncertainty

Fed Faces Crypto Dilemma: Cautious Leadership Amid Regulatory Uncertainty

Bitget-RWA2025/11/26 11:14
By: Bitget-RWA
- Kevin Hassett, Trump-aligned economist, emerges as top Fed chair candidate with 54% Kalshi odds, favored for dovish rate-cutting stance. - His crypto ties (Coinbase stock, advisory roles) fuel speculation about regulatory easing, though critics warn of potential conflicts of interest. - A Hassett-led Fed could prioritize lower rates and crypto-friendly policies, boosting risk assets like Bitcoin while reshaping regulatory frameworks. - Market watchers await Treasury Secretary Bessent's final decision, wi

Kevin Hassett, who leads the White House National Economic Council, has become the frontrunner to replace Jerome Powell as the Federal Reserve chair. Both prediction markets and political analysts are increasingly backing his nomination. On the Kalshi exchange, traders now estimate a 54% chance that he will be chosen,

highlighting his support for President Donald Trump’s economic policies. Hassett’s preference for lower interest rates, which matches Trump’s advocacy for quicker rate reductions, has made him a central figure in discussions about the Fed’s future direction. that with Hassett at the helm, the Fed may focus more on keeping borrowing costs down—a shift that could have wide-reaching effects on global financial markets, especially in areas like crypto and other risk assets.

Hassett’s reputation as a policymaker open to cryptocurrencies has fueled further debate about his possible influence. He holds more than $1 million in

shares and has been part of the company’s advisory council. He also led the White House’s digital asset working group . These connections have caught the attention of crypto market participants, who interpret his potential appointment as a sign of a more favorable regulatory environment. Hassett’s dovish approach and positive stance on crypto could encourage greater institutional involvement and pave the way for clearer digital asset regulations. Still, some critics warn that his financial interests in the sector could present conflicts, in shaping crypto and stablecoin rules.

Under Powell, the Fed has already started cutting rates in 2025, but Trump’s dissatisfaction with the pace has intensified the search for a new chair. Treasury Secretary Scott Bessent, who is overseeing the process,

, with Hassett, Christopher Waller, and Kevin Warsh among the top picks. Trump’s desire for a dovish leader is clear from his repeated demands for rate cuts—a position Hassett has publicly supported. " ," Hassett stated on Fox News, underscoring his alignment with Trump’s economic goals. This approach could keep U.S. interest rates low for an extended period, and benefit risk-oriented assets like , which has historically performed well during periods of loose monetary policy.

The potential impact on the crypto sector is twofold. First,

for crypto businesses and DeFi platforms, improving margins and trading activity. Second, a Fed chair with direct industry experience might emphasize regulatory clarity over stricter controls, encouraging innovation. that Hassett’s selection could create a “more favorable climate for crypto,” though actual market effects will depend on economic data and global events.

Fed Faces Crypto Dilemma: Cautious Leadership Amid Regulatory Uncertainty image 0
As the decision process draws to a close, for any updates, with many anticipating a verdict before Christmas 2025. While Hassett remains a strong contender, the final decision will influence not only U.S. monetary policy but also the Fed’s approach to new technologies. For now, the combination of dovish monetary views and crypto-friendly experience has made Hassett a central figure as markets prepare for significant changes.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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