Hassett Emerges as Frontrunner in Fed Chair Race
Prediction markets Polymarket and Kalshi now place Kevin Hassett, US President Donald Trump’s National Economic Council director, as the favorite to replace Jerome Powell as the next Federal Reserve chair. The odds of Hassett filling the seat have now spiked to 66% on Polymarket and 74% on Kalshi at the time of writing. Hassett is widely viewed as crypto-friendly thanks to his past role on Coinbase’s advisory council, a disclosed seven-figure stake in the exchange, and his leadership of the White House digital asset working group.
Founder and CEO of Wyoming-based Custodia Bank, and a prominent advocate for crypto-friendly regulations, Caitlin Long, commented on X: “If this comes true & Hassett does become Fed chairman, anti-#crypto people at the Fed who still hold positions of power will finally be out (well, most of them anyway). BIG changes will be coming to the Fed.”
Kevin Hassett’s Crypto Credentials and Potential Impact
Hassett is a long-time Republican policy economist who returned to Washington as Trump’s top economic adviser and has now emerged as the market-implied frontrunner to lead the Fed. His financial disclosure shows at least a seven-figure Coinbase stake and compensation for serving on the exchange’s Academic and Regulatory Advisory Council, putting him unusually close to the crypto industry for a potential Fed chair.
Still, crypto has been burned before by reading too much into “crypto-literate” resumes. Gary Gensler arrived at the Securities and Exchange Commission with MIT blockchain courses under his belt, but went on to preside over a wave of high-profile enforcement actions that critics branded “Operation Chokepoint 2.0.” A Hassett Fed might be more open to experimentation and less reflexively hostile to bank-crypto activity. However, the institution’s mandate on financial stability means markets should not assume a one-way bet on deregulation.
Supervision Pushback and the Fed's Evolving Stance
The Hassett odds have jumped just as the Fed’s own approach to bank supervision has received pushback from veterans like Governor Michael Barr, who earned his reputation as one of Operation Chokepoint 2.0’s key architects. According to Caitlin Long, “While he was Vice Chairman of Supervision & Regulation he did Warren’s bidding,” and he “has made it clear he will oppose changes made by Trump & his appointees.”
On November 18, the Fed released new Supervisory Operating Principles that shift examiners toward a “risk-first” framework, directing staff to focus on material safety-and-soundness risks rather than procedural or documentation issues. In a speech the same day, Governor Barr warned that narrowing oversight, weakening ratings frameworks, and making it harder to issue enforcement actions or matters requiring attention could leave supervisors slower to act on emerging risks, arguing that gutting those tools would repeat pre-crisis mistakes.
Days later, in Consumer Affairs Letter 25-1, the Fed clarified that the new Supervisory Operating Principles do not apply to its Consumer Affairs supervision program, an area under Barr’s committee as a governor. If prediction markets are right and a crypto-friendly Hassett inherits this landscape, his Fed would not be writing on a blank slate but stepping into an institution already mid-pivot on how hard and where it leans on banks.