The quiet halls of the Federal Reserve usually hum with talk of interest rates and economic forecasts. Lately, a different kind of buzz has started. We are seeing a list of potential leaders emerge, and some of them hold surprisingly open views on digital assets. This shift could reshape how the central bank sees the crypto world.
- The selection process for the next Federal Reserve Chair is underway, with Treasury Secretary Scott Bessent identifying potential candidates with notably open views on digital assets.
- Several leading contenders, including Vice Chair Michelle Bowman and Governor Chris Waller, have expressed a willingness to embrace financial innovation and integrate digital assets into mainstream finance.
- This potential shift in leadership suggests a future where the Federal Reserve may actively engage with and support cryptocurrencies, a significant departure from past approaches.
Treasury Secretary Scott Bessent has narrowed down his list for the next Fed Chair. Current Chair Jerome Powell’s term ends next year. On Bessent’s list are five names, and more than one has shown a real interest in crypto’s place in finance. This is a notable change from past years.
Among the top contenders is Michelle Bowman, the current Fed Vice Chair for Supervision. She has spoken plainly about the central bank facing a “crossroads.” She believes the Fed must decide if it will lead or fall behind in financial innovation. That is a strong statement from someone in her position.
Bowman has also pushed for banks and regulators to welcome new technologies. She wants them to move away from “an overly cautious mindset.” Perhaps most striking, she has suggested that Fed staff should hold a small amount of crypto. This, she says, would help them truly understand it. Imagine that, a Fed official suggesting hands-on experience with Bitcoin or Ether.
The process to pick the next Fed leader is a serious one. Bessent will interview these candidates. Senior Treasury and White House officials will join him. A shorter list then goes to President Trump. He will nominate a new Fed governor, who would later become the Fed Chair. The Senate must then confirm the pick.
Shifting Sands at the Fed
This search for new leadership comes at a time of tension within the central bank. President Trump has often criticized Chair Powell. He has said Powell did not lower interest rates quickly enough. President Trump even threatened to fire him. Removing a Fed member, however, is difficult. It requires “for cause” reasons, a rule meant to protect the Fed’s independence from politics.
We saw this independence tested recently. President Trump tried to fire Federal Reserve Board Governor Lisa Cook. He made accusations of mortgage fraud. Cook sued, and the Supreme Court allowed her to keep her position. These events show the high stakes involved in Fed appointments.
Just last month, Stephen Miran was confirmed by the Senate as a new central bank board governor. He replaced Adriana Kugler, who resigned to return to Georgetown University. These changes are part of a larger picture. They show a central bank in flux, even before a new Chair is chosen.
Chair Powell’s term as Fed Chair ends in May. He could, if he wished, continue to serve on the board of governors until 2028. But the focus now is on who will take the top spot. The names on Bessent’s list offer a glimpse into possible futures for the institution.
Crypto’s New Allies?
It is not just Bowman who holds positive views on crypto. Other candidates on the list have also made their positions clear. This suggests a broader shift in thinking among those who might lead the nation’s financial system.
Chris Waller, another current Fed governor, spoke last week about the Fed entering a “new era.” He believes crypto will “no longer be on the fringes.” This is a significant statement. It moves crypto from a niche topic to a mainstream concern for the central bank.
Waller also brought up the idea of a “payment account.” He thinks this could help entities focused on payment innovations. For crypto firms, this could mean easier access to the traditional banking system. It is a practical step that many in the digital asset space have long hoped for.
Then there is Rick Rieder, BlackRock’s chief investment officer for fixed income. BlackRock is a giant in asset management. Back in 2021, Rieder said the firm was “dabbling” in Bitcoin. That was a quiet acknowledgment from a major player.
More recently, in 2024, Rieder told The Wall Street Journal that Bitcoin can be volatile. He added, however, that people will become more comfortable with it over time. This shows a long-term perspective. It is a recognition of crypto’s staying power, even with its ups and downs.
Kevin Hassett, the National Economic Council Director, also has a direct connection to the crypto world. He disclosed in June that he holds a stake in Coinbase Global Inc. This holding is worth at least $1 million. It is not every day you see a potential Fed Chair with a personal investment in a major crypto exchange.
These candidates represent a new kind of thinking. Their views suggest a future where the Federal Reserve might not just tolerate crypto, but actively engage with it. The idea of a central bank leader suggesting staff hold crypto, or acknowledging its move from the fringes, would have seemed far-fetched just a few years ago.
The selection of the next Fed Chair will have deep effects on the economy. For the crypto world, it could mean a new chapter. A leader who understands and even supports digital assets could shape policy in ways we have only imagined. We will be watching closely as President Trump makes his choice, and the Senate considers the nomination.
