Powell is about to step down. Who will be the next "money printer"?

Powell “countdown”, Trump lays out plans in advance

In May 2026, Federal Reserve Chairman Powell's term will officially end. However, the Trump administration's strategy has already begun—Trump and Treasury Secretary Becerra are attempting to gain substantial control over monetary policy by mastering key voting rights on the Federal Reserve Board (FRB) before the first half of 2026. Currently, Trump's camp has secured three seats through Stephen Miran replacing Adriana Kugler, and board member Lisa Cook is under pressure to resign due to allegations of mortgage fraud, leaving them just one seat short of controlling the seven-member board.

From the proposal of the “shadow chairman” concept to the quiet layout of council seats, this game around the control of the Federal Reserve is reshaping the future landscape of cryptocurrencies. According to the two prediction platforms, Polymarket and Kalshi, several candidates with an open attitude towards cryptocurrencies are competing for this key position, and the market expectations for the next Federal Reserve chairman's candidate have shown significant divergence: Kevin Hassett, Kevin Warsh, and Christopher Waller have become the three major popular candidates, with odds significantly ahead; other candidates like Bowman and Basant have odds of ≤1%; notably, Musk also appeared on Polymarket's odds list, currently ranking last.

Three major popular candidates have emerged.

On September 5, Trump confirmed during a press interview in the Oval Office that Kevin Hassett (Director of the White House National Economic Council), Kevin Warsh (former Federal Reserve Governor), and Christopher Waller (current Federal Reserve Governor) are his “top three” final candidates to replace Powell.

1. Kevin Hassett: Leading the market forecast

In the prediction market, current White House National Economic Council Director Kevin Hassett leads with a 29% probability on Kalshi and 8% on Polymarket. This 63-year-old economist holds a significant position in the Trump camp. He served as the Chairman of the Council of Economic Advisers from 2017 to 2019 and was one of the main designers of the Tax Cuts and Jobs Act during Trump's first term, providing economic policy advice to Trump during the 2024 presidential campaign.

In terms of crypto stance, according to the financial disclosure documents submitted in June this year, Hassett holds between $1 million and $5 million worth of Coinbase stock, which he received as compensation for his role as an advisor to Coinbase. His total assets amount to at least $7.6 million, including speaking fees from institutions such as Goldman Sachs and Citigroup.

In terms of monetary policy stance, Hassett is a typical dove. He has publicly criticized Powell's decision to maintain high interest rates multiple times, believing that the Federal Reserve should more aggressively cut rates to support economic growth. Trump has praised Hassett several times on CNBC's “Squawk Box” program in August this year, viewing the “Kevins” (Hassett and Warsh) as priority candidates for the Federal Reserve chair.

2. Kevin Warsh: “Son-in-law of Estée Lauder”

Kevin Walsh is in second place with a probability of 19% at Kalshi and 13% at Polymarket, and his background is a perfect blend of Wall Street and Washington. In 2006, at the age of just 35, Walsh was appointed by then-President George W. Bush to the Federal Reserve Board, becoming the youngest member in the history of the Federal Reserve. During the 2008 financial crisis, he played a key role as a liaison between the Federal Reserve and Wall Street, coordinating the sale of Bear Stearns to JPMorgan Chase and participating in the decision-making process for the collapse of Lehman Brothers.

Josh's personal background is equally notable. His wife Jane Lauder is the heiress of the Estée Lauder cosmetics empire, with a net worth exceeding $2 billion. His father-in-law Ronald Lauder is not only a longtime friend and former benefactor of Trump, but also the person who first proposed the idea of the United States buying Greenland during Trump's first term. This deep network of political and business connections gives Josh a unique influence in Washington.

On cryptocurrency attitudes, Walsh has shown a pragmatic yet cautious stance. He has previously invested as an angel investor in the algorithmic stablecoin project Basis and the cryptocurrency index fund management company Bitwise. In a 2021 interview with CNBC, Walsh stated: “In the current environment of significant monetary policy shifts, Bitcoin makes sense as part of a portfolio; it is gaining new life as an alternative currency. If you are under 40, Bitcoin is your new gold.” He also mentioned that part of Bitcoin's rise is due to the “bid transfer” from gold, pointing out that Bitcoin's price volatility severely undermines its role as a reliable unit of account or an effective means of payment. Furthermore, in a 2022 op-ed for The Wall Street Journal, Walsh supported the issuance of a Central Bank Digital Currency (CBDC) in the U.S. to counter China's digital yuan, a stance that has drawn criticism from the crypto community for potentially threatening decentralization.

3. Christopher Waller: A staunch supporter of stablecoins.

Current Federal Reserve Governor Christopher Waller ranks third with a probability of 17% on Kalshi and 14% on Polymarket, and he may be the most pro-cryptocurrency current Federal Reserve official. Waller has been a Federal Reserve Governor since 2020 and previously served as the research director at the St. Louis Fed, being an authority in the field of monetary economics.

Waller's support for stablecoins is particularly noteworthy. In August this year, at the Wyoming Blockchain Symposium, he referred to the transformation of payment systems as a “technology-driven revolution” and explicitly stated that “stablecoins have the potential to sustain and expand the international role of the dollar.” He believes that stablecoins, with their 24/7 availability, near-instant settlement speeds, and unrestricted liquidity, have become especially useful financial tools, particularly in inflationary economies or areas with limited banking services.

Waller believes that stablecoins actually strengthen, rather than weaken, the global position of the dollar. In his speech at the “A Very Stable Conference” in February of this year, he compared stablecoins to “synthetic dollars,” complementing Bitcoin's “digital gold.” He also praised the recently passed GENIUS Act, considering it an important milestone in U.S. digital asset regulation, providing a foundation for the responsible expansion of stablecoins. Waller insists that innovation should primarily come from the private sector and opposes the Federal Reserve issuing a CBDC.

Other potential candidates

4. Michelle Bowman: A Reformer Rising from Within

Although there is only a 1% chance in the prediction market, current Federal Reserve Bank Vice Chair for Supervision Michelle Bowman should not be overlooked. As a board member directly appointed to the Federal Reserve by Trump in 2018, she was promoted to Vice Chair responsible for bank supervision this May and holds key influence in the formulation of stablecoin regulations.

Baumann has shown an open attitude towards cryptocurrencies. In August this year, she advocated in a speech that banks should support the wave of digital assets and that the Federal Reserve should provide rules that do not hinder the industry's development. She specifically emphasized that “regulators must recognize the unique characteristics of these new assets and distinguish them from traditional financial instruments or banking products.” She even suggested that Federal Reserve employees should be allowed to hold a small amount of crypto assets in order to “achieve a working understanding of the underlying functions.”

Bowman believes that tokenization can facilitate faster ownership transfers, reduce costs, and mitigate “well-known risks,” stating that stablecoins “will become fixtures in the financial system.” She criticized the “overly cautious mindset” and advocated for a “pragmatic, transparent, and tailored” regulatory framework. At the FOMC meeting in September 2024, she voted against a significant 50 basis point rate cut, supporting a more moderate 25 basis point reduction, a stance that earned her the admiration of Trump.

5. Scott Bessent: The current Secretary of the Treasury, Bessent clearly stated in his speech in July this year that “cryptocurrency is not a threat to the dollar, and stablecoins can actually strengthen the dollar's hegemony.” Although he made it clear that he would not use Treasury funds to purchase Bitcoin, he supports using seized government crypto assets to establish reserves, currently valued at approximately $15-20 billion.

6. Judy Shelton: Economist, Shelton's views may be the most disruptive. As a staunch advocate of the gold standard, Shelton has long criticized the Federal Reserve's excessive power, even comparing it to the Soviet central planning economic system, arguing that the Fed's 2% inflation target is a disguised confiscation of the public's wealth. Shelton sees the alignment between the gold standard concept and cryptocurrency, having stated, “I like the idea of gold-backed currency, and it can even be implemented in a cryptocurrency way.”

7. Roger W. Ferguson Jr.: Former Vice Chairman of the Federal Reserve, representing the voice of the traditional financial establishment. Ferguson led the Federal Reserve's initial response during the 9/11 attacks, ensuring the normal functioning of the U.S. financial system. Ferguson has not publicly stated a clear position on cryptocurrencies, but he emphasizes the importance of maintaining the Federal Reserve's independence and warns that political interference could undermine the U.S. economic leadership.

8. Arthur Laffer: The father of supply-side economics, a famous creator of the “Laffer Curve” and one of the architects of Reaganomics. Laffer views Bitcoin as “private rules-based money,” similar to the gold standard, which can promote global monetary progress and aligns with the supply-side philosophy (reducing government intervention and promoting growth).

9. Larry Kudlow: Former Director of the White House National Economic Council, his attitude towards cryptocurrency is relatively cautious but gradually open. Kudlow was viewed by the crypto community in 2019 as “the best argument for why we need Bitcoin” for criticizing Bitcoin. However, by 2022, he began warning on Fox Business Channel's program that “radical progressives will try to regulate digital currencies,” opposing excessive regulation of cryptocurrencies.

10. Ron Paul: Former Texas Congressman, highly respected in libertarian and Bitcoin communities. Paul has gradually become a staunch supporter of Bitcoin, starting from a position of criticizing the Federal Reserve. He claims that the only way to avoid recessions caused by the Federal Reserve is to encourage people to use alternative currencies like Bitcoin and to exempt cryptocurrency from capital gains tax.

11. Chamath Palihapitiya: Billionaire, venture capitalist, and one of the most influential Bitcoin advocates in Silicon Valley. Palihapitiya once held a large amount of Bitcoin, and although he later regretted selling Bitcoin worth $3-4 billion, he remains a staunch supporter of cryptocurrency. He proposed that the government could use its Bitcoin holdings to launch a U.S. sovereign wealth fund, raising $50-100 billion through borrowing rather than selling Bitcoin.

12. Howard Lutnick: Current Secretary of Commerce and CEO of Cantor Fitzgerald. Lutnick's company is a major custodian for Tether, the issuer of USDT, holding tens of billions of dollars in U.S. Treasury bonds to back USDT. His son, Brandon Lutnick, has also collaborated with SoftBank, Tether, and Bitfinex this year to establish a $3 billion Bitcoin investment fund.

Although these candidates have low odds of winning in the prediction market, their differing attitudes towards cryptocurrency reflect the diversity of U.S. policymakers' understanding of digital assets. From Bessen's vision of a “crypto superpower” to Powell's idea of monetary freedom, from Lutnick's business practices to Laffer’s economic theories, each perspective offers unique insights into the potential future direction of the Federal Reserve's cryptocurrency policies. Personnel changes, policy loosening, and softened attitudes indicate that the Federal Reserve, which once made the crypto market “walk on thin ice,” is now re-engaging in dialogue with the industry.

Market expectations: Is the era of massive monetary easing approaching?

Mike Novogratz, CEO of Galaxy Digital, clearly stated during an interview with Kyle Chasse: “The next Federal Reserve Chairman could be the biggest catalyst for a bull market in Bitcoin and the entire cryptocurrency space.” Novogratz predicted that if Trump appoints a “very dovish” Federal Reserve Chairman and significantly cuts interest rates when it shouldn't, the price of Bitcoin could reach $200,000. Meanwhile, BitMEX founder Arthur Hayes gave an even more outrageous prediction in his latest article “Four, Seven”, stating that Bitcoin's price could reach $3.4 million—if the Trump administration implements yield curve control (YCC) through the Federal Reserve, it could create up to $15.2 trillion in credit. Based on the historical correlation of “for every $1 of credit created, Bitcoin rises by $0.19”, Bitcoin could reach $3.4 million.

However, Novogratz also warned that this scenario is “really bad for the U.S.”, believing that while this aggressive monetary policy is beneficial for cryptocurrencies, the cost will be the loss of the Federal Reserve's independence and severe damage to the U.S. economy. Hayes also believes that the Federal Reserve will be forced to massively purchase long-term government bonds to lower interest rates, and regional banks will gain more lending space to support small and medium-sized enterprises, with the scale of liquidity injection far exceeding that during the pandemic in 2020. This “quantitative easing for the poor 4.0” policy will shift the credit creation power from Wall Street to the small and medium-sized banks on Main Street.

Conclusion: Waiting for the shoe to drop

As Novogratz said, the “political situation” makes it unprecedentedly difficult to predict the peak of the Bitcoin cycle. The turnover of personnel at the Federal Reserve has never been just a bureaucratic procedure; it is a catalyst for reshaping the entire crypto landscape. From the softening of the SEC's stance to the FDIC easing restrictions, from the approval of Bitcoin ETFs to the advancement of stablecoin legislation, every loosening of the regulatory environment is paving the way for the upcoming major changes in monetary policy.

Polymarket data shows that there is a 44% probability that Trump will not announce the next Federal Reserve chair candidate within the year, which means the market may have to wait several months to see the direction clearly. However, looking at the backgrounds of the current popular candidates, regardless of who ultimately takes over, they generally exhibit a more open attitude towards financial innovation. This shift is not accidental; an irreversible trend has formed: as BlackRock manages the largest Bitcoin ETF, a Federal Reserve governor openly supports stablecoins, and the Treasury Secretary states that “cryptocurrency is not a threat to the dollar”—the highest halls of traditional finance have opened their doors to digital assets, and a more crypto-friendly regulatory era may be on the horizon. For the crypto industry, whoever ultimately takes over will need to be prepared to face the potential arrival of a “massive liquidity era.”