Trump is laying the groundwork for the next Federal Reserve chair, with five candidates emerging. This personnel change is stirring the nerves of every cryptocurrency investor.

1. The Five Contenders: Who Will Lead the Federal Reserve?

U.S. President Trump stated on Monday that he may announce his nominee to replace Federal Reserve Chair Powell by the end of the year, as Powell's term ends in May next year.

U.S. Treasury Secretary Mnuchin revealed to reporters on Air Force One that the candidate pool has been narrowed down to five final contenders.

This personnel decision is of great interest to the crypto market because the monetary policy stance of the new Federal Reserve chair will directly impact the global liquidity environment, which in turn will affect the price trends of risk assets like cryptocurrencies.

The five confirmed candidates include:

● White House National Economic Council Director Kevin Hassett

● Former Federal Reserve Governor Kevin Warsh

● Current Federal Reserve Governor Christopher Waller

● Current Federal Reserve Vice Chair for Supervision Michelle Bowman

● Senior Executive at BlackRock Rick Rieder

2. Candidate Policy Stance Analysis

Candidate

Current Position/Background

Main Policy Inclinations and Background

Kevin Hassett

White House National Economic Council Director

Close relationship with Trump, highly aligned stance, has publicly criticized Powell for being "behind the curve" on interest rate cuts.

Kevin Warsh

Former Federal Reserve Governor

Was the youngest Federal Reserve Governor, called for "systemic reform" of the Fed, advocates for significant balance sheet reduction to create space for rate cuts.

Christopher Waller

Current Federal Reserve Governor

Nominated by Trump, the first Fed governor to call for a return to rate cuts in 2025. Advocates for central bank independence but supports internal reforms.

Michelle Bowman

Current Federal Reserve Vice Chair for Supervision

Nominated by Trump, comes from a banking family, led the relaxation of bank capital rules, and was one of the earliest officials to support rate cuts this year.

Rick Rieder

Senior Executive at BlackRock

Responsible for fixed income business, has extensive experience in financial markets, previously advocated for larger rate cuts (50 basis points) while emphasizing central bank independence.

Source: AiCoin Compilation

This statement clearly indicates Trump's demand—hoping for the Federal Reserve to implement a more accommodative monetary policy.

3. Multiple Impacts on the Crypto Market

The impact of the Federal Reserve chair selection on the crypto market is mainly reflected in three areas:

Price and Trading Aspects

● Accommodative expectations drive increases. If a new chair inclined towards rate cuts takes office, it may strengthen the market's ongoing accommodative expectations, enhancing the appeal of high-risk assets like cryptocurrencies.

Historical data from AiCoin shows that Bitcoin often exhibits "expectation-driven increases" before monetary policy easing.

● Volatility may intensify. Any news during the nomination and appointment process could trigger market sentiment fluctuations. Special attention should be paid to the second round of interviews in November and the final nomination at the end of the year.

Funds and Liquidity

● Low interest rate environment benefits crypto assets. The Federal Reserve cut rates by 25 basis points in September, and the market generally expects another 25 basis point cut in this week's meeting. If the new chair pushes for larger rate cuts, the global liquidity environment will further ease, and some funds may flow into the crypto market seeking higher returns.

● Key impact on the dollar's performance. A dovish chair could lead to a weaker dollar, further boosting the prices of cryptocurrencies priced in dollars.

Regulation and Industry Development

● Regulatory stance determines development space. The new chair's position on the crypto industry will influence the future regulatory framework. Kevin Warsh's interest in central bank digital currencies (CBDC) may accelerate discussions on a digital dollar.

● Indirect impact on bank regulation. If Bowman is elected as Vice Chair, her stance on bank regulation may affect the compliance environment for cryptocurrency banks.

Impact Dimensions

Short-term Impact (1-3 months)

Medium to Long-term Impact (6 months and beyond)

Monetary Policy

Market expectation volatility, price fluctuations; BTC/ETH may fluctuate 10-15% before the FOMC meeting, with speculators betting on a 25-50 basis point cut.

Reshaping of interest rate paths, changing asset pricing logic; new chair may push for cumulative rate cuts of over 100 basis points by 2026, benefiting crypto valuation models (risk premium under DCF decreases).

Funds Flow

Speculative funds entering and exiting rapidly; retail investors flocking to DeFi/meme coins, while institutions' caution leads to short-term outflow risks.

Institutional fund allocation strategy adjustments; pension funds/ETFs increasing crypto exposure (target 10-20%), with liquidity injections exceeding $50 billion.

Regulatory Environment

High policy uncertainty; Trump's intervention signals amplify SEC uncertainty, temporarily suppressing NFT/stablecoin innovation.

Regulatory framework gradually clarifying; a dovish chair (like Warsh) may promote crypto-friendly rules, with the CFTC leading the stablecoin framework, benefiting RWA tokenization.

Source: AiCoin Compilation

4. Market Perspectives and Risk Warnings

The market overall exhibits a cautiously optimistic sentiment. Investors generally expect that regardless of who is elected, the Federal Reserve's policy will shift towards accommodation, but they remain vigilant about market volatility during the transition.

Expert Opinion Analysis

Analyst from the crypto macro research institution "Digital Wave":

● "If Trump appoints a more compliant Federal Reserve chair like Hassett, we may see a faster rate cut path, which would be beneficial for cryptocurrencies in the short term. However, the long-term risk is that the independence of the Federal Reserve may be compromised, leading to future policy reversals."

Chief Strategist at blockchain investment firm "Frontier Capital":

● "The market should pay the most attention to candidate Rieder. Coming from BlackRock, he has a deep understanding of both traditional finance and emerging assets, and he may find a balance between supporting innovation and maintaining stability, which would be a long-term benefit for the institutionalization of cryptocurrencies."

Research Director at quantitative trading firm "Alpha Strategy":

● "If Waller is elected, the market may see a 'reversal trade' regarding 'Federal Reserve independence.' In this case, Bitcoin may face short-term pressure, but as the rate cut cycle is confirmed, the medium to long-term outlook remains positive."

Potential Risk Warnings

● Long-term risk of compromised Federal Reserve independence. Historically, the "Nixon pressuring Burns" incident severely damaged the Fed's credibility; if the Fed is seen as politicized, it may trigger market concerns about long-term inflation.

● Risk of policy uncertainty. An unusually early nomination has drawbacks; Powell's successor may find themselves in a dilemma, and this uncertainty could increase market volatility in the short term.

● Risk of tightening regulation. Some candidates may hold a more cautious attitude towards cryptocurrencies, leading to stricter regulatory measures.

Core Dynamics to Track in the Future

● Timeline of the selection process. Secretary Mnuchin plans to conduct the second round of interviews in November and hopes to submit a more streamlined list to Trump after Thanksgiving. Trump stated that the final candidate will be revealed by the end of the year.

● Senate confirmation hearings. The candidates nominated by Trump will need to go through Senate confirmation, which will provide more clues about their policy positions, especially regarding monetary policy direction and cryptocurrency regulation.

In the coming months, as the selection of the new Federal Reserve chair becomes clearer, the cryptocurrency market may experience a repricing driven by liquidity expectations. This personnel change not only concerns who will lead the world's most important central bank but will also determine the direction of global liquidity in the coming years.

For the cryptocurrency market, grasping the differences between candidates' policy stances and market expectations may be the key winning factor in the next round of market trends.

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