Trump Taps Hassett? If the Fed Turns Dovish in 2026, It Will Become a New Dividend for the Crypto Market

As U.S. President Trump has repeatedly hinted that the next Federal Reserve Chair for 2026 has been decided, current White House National Economic Council Director Kevin Hassett has emerged as the most prominent “dovish” candidate, with his policy leanings drawing strong attention from the crypto market. Analysts point out that if Hassett replaces current Chair Jerome Powell, it would signal a shift at the Fed from “cautious anti-inflation” to “aggressive pro-growth,” potentially triggering a faster rate-cutting cycle, greater global liquidity, and a weaker dollar. History shows that these three factors are core macro drivers for crypto assets, especially Bitcoin and Ethereum, to rise. While this change may raise concerns about central bank independence, the market generally sees it as one of the most important potential positives for the crypto market in 2026.

Candidate Focus: Why Is Hassett Seen as a “Friend of Crypto”?

Amid intense personnel speculation in Washington, Kevin Hassett’s name is increasingly being linked to the top job at the Fed. This is not without basis—President Trump’s recent hints that a decision has been made, along with Hassett’s central position in the White House economic team, make him the strongest contender to succeed Powell when his term ends in May 2026. For the crypto market, understanding Hassett’s economic philosophy is key to anticipating future policy.

Unlike Powell, who has a deep central banking background and is known for being data-driven and independent, Hassett is a classic “supply-side” economist. His career has long focused on advocating growth-promoting policies, including tax cuts and looser financial conditions. This ideological background shapes his policy leanings: compared to Powell’s wariness of inflation risks and his cautious, gradual approach, Hassett has publicly stated that if he were leading the Fed, “rates would be cut now.” This distinctly dovish stance closely aligns with the Trump administration’s political goal of faster and larger-scale monetary easing to stimulate the economy and asset prices.

The market interprets the possibility of Hassett taking office as a clear signal: the Fed’s policy focus will shift significantly from “price stability” to “economic growth.” This shift means that in 2026 and beyond, we may see a faster and larger rate-cutting monetary policy cycle. For all risk assets highly sensitive to liquidity, especially crypto assets, this is undoubtedly a fundamental top-level policy positive.

Policy Comparison: From Powell’s “Anchor” to Hassett’s “Sail”

To quantify the changes Hassett might bring, the best way is to compare him with current Chair Powell. Under Powell, the Fed established a cautious image guided by “long-term price stability” in response to post-pandemic inflation. Even when economic data and the job market showed signs of cooling, Powell prioritized fully taming inflation, insisting on predictable, incremental easing steps. This “steady-state” style is like the “anchor” of a giant ship, providing stability amid market storms, but also limiting the speed and height of asset price surges during liquidity booms.

If Hassett leads the Fed, he would bring a completely different style. His policy framework is more like a wind-driven “sail,” aimed at using monetary tools to maximize economic growth and asset values. The direct consequences may be seen in three areas: First, an accelerated pace of rate cuts. The market expects a Hassett-led Fed to respond more aggressively to growth data than to residual inflation, moving up and increasing the scale of rate cuts. Second, a weaker dollar. More aggressive easing policies typically lead to a decline in the currency’s relative value, and historical data has repeatedly shown a strong correlation between weak dollar cycles and strong cycles for crypto assets like Bitcoin. Third, global liquidity expansion. As the world’s central bank bellwether, a Fed that speeds up “printing money” leads to a more accommodative global liquidity environment.

This shift directly suppresses real interest rates (inflation-adjusted rates). When returns on cash and Treasuries fall, investors’ motivation to seek higher-return assets rises sharply. Bitcoin and Ethereum, due to their non-sovereign, fixed-supply nature and reputation as “digital gold/digital oil,” often become the prime beneficiaries of such capital flows.

Hassett vs. Powell: Potential Policy Path Comparison

Policy Philosophy:

• Hassett: Favors supply-side economics, advocates aggressive use of monetary policy to stimulate growth, clearly dovish.
• Powell: Data-driven, prioritizes price stability, emphasizes policy independence and gradualism.

Attitude Toward Interest Rates:

• Hassett: Has publicly stated “rates would be cut now,” advocates a faster, larger-scale easing cycle.
• Powell: Insists on a cautious, predictable rate-cut path, uses inflation data as the key decision factor.

Potential Market Impact:

• Hassett: May drive a weaker dollar and rapid global liquidity expansion, significantly benefiting risk assets.
• Powell: Provides policy predictability, with relatively lower market volatility, but injects liquidity at a slower pace.

Implications for the Crypto Market:

• Hassett: Seen as a strong macro positive, could directly catalyze a new crypto bull market.
• Powell: Provides a stable macro backdrop, but growth relies more on industry fundamentals.

Market Projections: How Will the Liquidity Tide Flow into the Crypto Ecosystem?

If Hassett takes office in 2026 and implements his dovish agenda, how specifically will the crypto market respond? The impact will be multi-layered and diffusive. The first to benefit will be Bitcoin and Ethereum. As the “blue chips” of the crypto market and the main carriers of macro narratives, they are most sensitive to changes in real interest rates and the dollar index. A looser monetary environment will directly enhance their appeal as stores of value and inflation hedges, likely leading to a surge in institutional demand via regulated channels such as spot ETFs.

Next, altcoins and the DeFi ecosystem will also benefit. When credit costs drop and overall risk appetite rises, capital doesn’t just stay in top assets. Some funds seeking higher alpha will naturally rotate into decentralized finance, Layer 2 solutions, and emerging token projects. This will not only push up the prices of related assets but also significantly increase on-chain activity, protocol revenues, and ecosystem vibrancy. We can expect that key metrics such as trading volume and total value locked (TVL) may rebound significantly under the push of liquidity.

However, opportunity always comes with risk. A Fed perceived as more willing to accommodate the executive branch may trigger deep concerns about central bank independence. If the bond market becomes volatile due to doubts about the Fed’s determination to fight inflation, that uncertainty alone could impact all risk assets, and crypto will not be immune. Moreover, overly rapid easing could reignite inflation in the medium to long term, forcing policy to reverse sharply and causing severe market swings. Thus, the Hassett era could mean greater beta (volatility) and richer return potential for the crypto market.

Background: Historical Market Impact of Fed Leadership Changes

Looking back, changes in Fed leadership have often preceded major market turning points. For example, Paul Volcker’s aggressive rate hikes after taking office in 1979 tamed inflation, causing short-term market pain but laying the foundation for long-term growth. Alan Greenspan’s long tenure was closely tied to the rise and fall of the tech bubble. More recently, Jerome Powell’s pivot from “hiking and balance sheet reduction” to “rate cuts and liquidity injections” directly fueled the massive rebound in risk assets since 2023.

These historical cases show that a new Fed Chair’s policy orientation and key decisions in the first term set the tone for the following years. For the crypto market—a nascent asset class with just over a decade of history—there haven’t been many complete Fed cycles, but its sensitivity to global liquidity tides is already well demonstrated. The potential 2026 personnel change, with its possible dramatic shift in policy style, is worth close study and early positioning by every market participant.