Trump Signals a Favorite as Fed Chair Race Heats Up and Crypto Markets Watch Closely

The race to appoint the next U.S. Federal Reserve chair is entering its decisive phase, with President Donald Trump expected to begin interviewing finalists as early as this week. 

According to a report from the Financial Times, Treasury Secretary Scott Bessent has formally presented a shortlist of four candidates to the White House, signaling that a final decision is drawing closer.

Trump confirmed the accelerated timeline on Tuesday, telling reporters aboard Air Force One that while multiple contenders remain under review, he already has a preferred choice in mind. 

“We’re going to be looking at a couple different people, but I have a pretty good idea of who I want,” said Donald Trump, adding to speculation that the appointment could be resolved sooner than expected, with a formal announcement likely in January.

Also read: Trump Says Fed Chair Decision Made as Markets Bet on Hassett

A Shortlist of High-Profile Fed Chair Contenders

One of the candidates on Bessent’s list is former Federal Reserve governor Kevin Warsh, whom the Treasury Secretary is scheduled to meet with on Wednesday. 

Another leading contender is Kevin Hassett, the current director of the National Economic Council and widely viewed as the frontrunner for the post.

The remaining two potential finalists are expected to be selected from a larger pool that includes sitting Fed governors Christopher Waller and Michelle Bowman, as well as Rick Rieder, the chief investment officer for global fixed income at BlackRock.

Trump and Bessent are expected to conduct at least one interview next week, with the White House aiming to make the selection official in the first month of the new year. 

Whoever emerges will inherit control of U.S. monetary policy at a sensitive moment for inflation, employment, and financial market stability.

Hassett’s Frontrunner Status Faces a New Test

Hassett’s status as the favorite gained significant traction earlier this month after a public remark from Trump sent shockwaves through political and financial circles. 

During a White House event on Dec. 2, Trump referred to Hassett as a “potential Fed chair,” a comment widely interpreted as an early signal of presidential backing.

That single phrase was enough to sharply move prediction markets. On both Kalshi and Polymarket, implied odds for Hassett surged to roughly 85% almost immediately. Since then, those odds have eased back to around 71%, while Warsh’s probability has hovered near the low teens throughout December.

Contract asking who the next Fed Chair will be (Source: Polymarket)

The fact that formal interviews are only now beginning suggests that the race remains open, despite the strong betting market tilt toward Hassett. 

The latest developments also indicate that Trump and his economic team may still be weighing broader strategic considerations before locking in their final choice.

What The Fed Decision Means for Crypto Markets

For digital asset investors, the Fed chair appointment is far more than a political headline.

Interest rate policy remains one of the strongest macro drivers of crypto market liquidity, capital flows, and risk appetite. Shifts in the central bank’s stance on inflation, rate cuts, or balance sheet policy can quickly ripple into Bitcoin, Ethereum, and the broader altcoin market.

A chair perceived as closely aligned with the White House could revive concerns about political influence over monetary policy. Such concerns have historically bolstered Bitcoin’s narrative as a hedge against currency debasement and institutional risk, even as higher interest rates tend to suppress speculative investment across digital assets.

Also read: Five Pro-Crypto Contenders Emerge to Lead the Federal Reserve After Powell

Hassett Pushes Back on Political Alignment Fears

Despite his close ties to Trump, Hassett has sought to reassure markets that he would act independently if confirmed. 

In comments published this week by The Wall Street Journal, he emphasized that policy decisions must remain grounded in data rather than politics.

“You just do the right thing,” Hassett said when asked whether he would be inclined to follow direct presidential guidance on interest rates. “Suppose that inflation has gotten from, say, 2.5% to 4%. You can’t cut.”

He added that any decisions would ultimately rest on his own judgment, noting that this is the judgment “which I think the president trusts.” 

A Decision With Global Consequences

The next Fed chair will step into office amid lingering inflation risks, elevated government debt, and uneven global growth. 

For crypto markets, the appointment could define the tone of U.S. monetary policy just as digital assets are once again being shaped by macroeconomic forces rather than purely industry-specific cycles.

With interviews imminent and Trump openly signaling that a favorite already exists, the coming weeks are likely to bring heightened volatility not only in traditional markets, but also across the digital asset landscape.