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Certain members of the crypto community would love to wave goodbye to US Federal Reserve Chairman Jerome Powell when Donald Trump becomes president. The two men have sparred for years, and crypto promoters want to see Trump surrounded with loyalists who keep markets sailing smoothly.
Already assuming that Trump will find some way to oust Powell, potential candidates for his replacement are already circulating. Current top guesses include Scott Bessent, Kevin Warsh, Kevin Hassett, David Malpass, and Judy Shelton.
Powell and Trump famously clashed over interest rate policies in 2018 when Powell declared he was prepared to defend the Fed’s independence from the Executive branch in the courts. He further reminded reporters that Trump may not fire him.
Pundits speculated that Trump only backed off Powell in 2018 because his threats damaged confidence in an already shaky stock market.
Now that six years have passed since their last spat, Trump recently granted a conditional pledge to let Powell finish his term through 2026 “if I thought he was doing the right thing.”
Will Trump actually try to fire Jerome Powell?
From the crypto industry’s perspective, the earlier Powell leaves, the better. Lower interest rates, a bigger central bank balance sheet, and quantitative easing at the Fed are a recipe for booming markets.
Unfortunately, Powell is a moderate and has hiked interest rates by hundreds of basis points during Joe Biden’s term.
Incidentally, and important for context, Trump appointed Powell early in his first term as president. Granted, his 2016 appointment certainly does not mean that Trump will not try to interfere with Powell or his Fed governors during the 2025 presidency.
Indeed, Polymarket already brokers crypto-denominated bets that Trump will fire Powell within 100 days of taking office at a 7% odds rate.
How Trump would fire someone who claims the president may not fire him remains to be seen. Powell shows little interest in going anywhere without a fight.
If Powell does depart, though, who would replace him? Below are some potentials.
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Scott Bessent
One of George Soros’ former chief investment officers, Bessent is already an economic adviser to Trump. He is keen to see Powell depart and has brazenly proposed a “shadow” Fed chair to effectively sideline Powell until his scheduled departure in 2026.
Bessent has been a generous Republican donor and Trump supporter. His Wall Street experience and conservative values could make him an appealing Fed chair candidate for Trump.
Kevin Warsh
Former Fed governor Warsh lost his bid for a job promotion in 2017 to Powell, but he is hoping for better chances this time. Warsh has close ties to Trump through his father-in-law Ronald Lauder, the Estée Lauder tycoon and longtime friend of Trump.
Warsh is married to Lauder’s daughter, Rachel.
Kevin Hassett
One of Trump’s former senior advisers, Hassett is a Trump loyalist with White House experience. His alignment with the incoming president and experience as chairman of the Council of Economic Advisers could give him favorable odds for a Fed chairman nomination.
David Malpass
Appointed by Trump to lead the World Bank, Malpass is an obvious candidate for Fed chair. His experience in international finance and personal connections with central bankers and sovereign wealth managers around the world give him instant credibility.
Judy Shelton
Trump tried to nominate Shelton to the Fed in 2020 without success, but he might try again next year. She’s a former economic advisor to Trump, a fan of the gold standard, and a staunch critic of Jerome Powell.
Her unconventional monetary policies and proven loyalty to Trump could cater to his desires to reshape the Federal Reserve and challenge traditional economic policies.
These six candidates are, of course, only a few names among many that conservatives have floated.
Will Jerome Powell’s successor be a pro-crypto Trump loyalist?
Powell has mixed views regarding digital assets. He once referred to bitcoin as digital gold even though he thought it was too volatile to ever replace the US dollar. He also once acknowledged bitcoin’s “staying power” while testifying before the House Financial Services Committee.
Nevertheless, his incidental comments have not calmed criticisms of his hawkish monetary policies. Crypto would prefer a pro-crypto chairperson who is a Trump loyalist. Anyone who is pro-stimmy will do.
If Trump tries to fire Powell, the two men will probably clash in a legal battle that will determine the president’s level of control over the ostensibly independent Federal Reserve.