Crypto Traders Increase Bets on Kevin Warsh After Trump Names Top Two Fed Chair Candidates

Former Fed Governor Kevin Warsh has seen his odds of becoming the next Fed chair climb in recent days. This comes as crypto traders increase their bets on Warsh, as U.S. President Donald Trump has named his top two candidates to replace Jerome Powell.

Crypto Traders Ramp Up Bet On Warsh Becoming Next Fed Chair

Polymarket data shows that crypto traders have increased their bets on Warch becoming the next Fed chair. As a result, his odds of replacing Powell climbed from around 13% yesterday to 36% today. The former Fed governor is now also the second clear favorite for the role, only behind the Director of the National Economic Council, Kevin Hassett.

There is currently a 56% chance that Trump will nominate Hassett as the next Fed chair. It is worth mentioning that Hassett’s odds had climbed to as high as 70% in recent weeks, but have now dropped as crypto traders also see the possibility of Warsh getting the nod.

The surge in Warsh’s odds follows a WSJ report, which revealed that the U.S. president is leaning towards Warsh or Hassett to replace Powell. Trump has specifically remarked that he thinks that Warsh was at the top of his list, but also brought Hassett into the mix, suggesting that he will nominate either of them.

As CoinGape reported, Trump interviewed the five Fed chair candidates this week, with Warsh reportedly impressing the president during the interview. The other candidates besides Hassett and Warsh are Fed Governors Chris Waller and Michelle Bowman, and BlackRock CIP Rick Rieder.

Meanwhile, Trump again advocated for lower interest rates during his interview with the Wall Street Journal. He stated that the U.S. should have the lowest interest rates, with rates coming down to as low as 1%.

The U.S. president also mentioned this week that the next Fed chair must immediately lower rates, as this is a ‘litmus test’ in deciding who will replace Powell. Hassett already stated that there is plenty of room to make larger cuts.

JPMorgan CEO Signals Support For Warsh

According to an FT report, JPMorgan CEO Jamie Dimon has signaled his support for Warsh to replace Powell. Dimon has also reportedly told Wall Street executives that Hassett is more likely to back Trump’s call for lower rates.

Amid anticipation of who Trump will nominate to replace Powell, crypto traders are also betting on how many rate cuts the Fed is likely to make next year. Most traders are betting on three rate cuts next year, with a 215 chance of this happening.

With Trump likely to nominate a rate-cut advocate as the next Fed chair, the Fed may make more cuts than the current median projection of just one 25-basis-point cut in 2026. Fed president Austan Goolsbee stated yesterday that he expects the committee to make more cuts than the median projection.