Crypto Traders Shift Bets as Judy Shelton Gains Momentum in Fed Chair Race

Crypto traders are increasingly placing bets on former Trump advisor Judy Shelton as speculation around the next Federal Reserve chair intensifies, according to data from major prediction platforms. While Kevin Hassett remains the leading favorite to replace current Fed Chair Jerome Powell, his odds have declined notably, signaling a tighter and more competitive race as markets await President Donald Trump’s final decision.

Data from Kalshi shows Shelton’s odds of becoming the next Fed chair have risen to 5%, reflecting growing interest among crypto traders. Although this figure remains relatively low compared to other contenders, it marks a meaningful increase amid broader uncertainty. Hassett, who was once seen as the overwhelming favorite with odds near 85% in early December, has seen his chances fall to 38%. This drop suggests traders are reassessing expectations as new developments emerge.

Similar trends are visible on Polymarket, where Shelton currently holds a 3% chance of being nominated. Kevin Warsh and Federal Reserve Governor Chris Waller are also viewed as strong contenders, with odds of 36% and 13%, respectively. Interestingly, Shelton and BlackRock executive Rick Rieder both sit at 5% odds on Kalshi, despite reports indicating that the official shortlist includes only Hassett, Warsh, Waller, and Rieder.

According to CoinGape, Trump was expected to interview Rieder in the final week of 2025 after already meeting with Warsh and Waller. However, there has been no confirmation from the White House, and Trump has remained publicly silent on his preferred candidate in recent weeks. Previously, the former president suggested he was leaning toward either Hassett or Warsh.

Adding to the uncertainty, Trump recently reignited tensions with Jerome Powell by criticizing his leadership and hinting at potential legal action, citing alleged “gross incompetence.” These comments have fueled speculation that Trump is eager to move quickly on naming Powell’s successor.

Prediction markets indicate a high probability that Trump will announce his Fed chair nomination soon. Kalshi traders are assigning an 82% chance that the announcement comes by February 1, while Polymarket places a 79% likelihood on a decision by January 31. This timeline suggests the nomination could occur before the January FOMC meeting.

Beyond the nomination itself, investors are also closely watching whether Powell will remain on the Federal Reserve Board after his term as chair ends in May. A resignation could allow Trump to gain greater influence over the Fed, potentially advancing his push for significantly lower interest rates, a policy stance closely watched by both traditional and crypto markets.