The US Department of Justice's decision to drop its investigation into Federal Reserve Chair Jerome Powell has brought President Donald Trump's pick to replace him, Kevin Warsh, one step closer to confirmation. Warsh, who has significant personal wealth, including cryptocurrency assets, appeared before a Senate confirmation hearing and is now awaiting a final vote.
Trump, who has criticized Powell for high interest rates, selected Warsh to address this issue. However, Republican Senator Thom Tillis had previously stated that he would block Warsh's confirmation as long as the DOJ's investigation into Powell continued. The investigation, which was related to cost overruns in a Fed building project, was dropped on Friday, with the US Attorney for the District of Columbia, Jeanine Pirro, announcing that the Fed's inspector general would take over the inquiry. Following this news, the likelihood of Warsh's confirmation before May 15 increased significantly.
The development is seen as a strategic move by Trump to exert greater influence over US monetary policy by placing his allies on the Federal Reserve board, which makes key decisions on financial policy, including regulations for the crypto industry. Senator Elizabeth Warren, the ranking Democrat on the Senate Banking Committee, criticized the move, stating that it was an attempt to facilitate Warsh's confirmation. Tillis, however, expressed his support for Warsh, calling him a 'great nominee' and indicating that he would vote in favor of his confirmation now that the DOJ has dropped its investigation into Powell.