The US Department of Justice has relinquished its investigation into Federal Reserve Chair Jerome Powell, potentially paving the way for President Donald Trump's nominee, Kevin Warsh, to take the reins. Warsh, who boasts significant wealth, including assets in the cryptocurrency sphere, has been awaiting a Senate vote following his confirmation hearing. Trump, who has been critical of Powell's handling of interest rates, selected Warsh as his replacement, but the confirmation process was stalled due to a criminal probe into Powell's involvement in a Federal Reserve building project.
The investigation's dismissal has shifted the odds of Warsh's confirmation before May 15 from 30% to over 80%, according to Kalshi's prediction betting. US Attorney for the District of Columbia Jeanine Pirro stated that the DOJ has requested the Fed's inspector general to investigate the matter and issue a report, adding that she will not hesitate to restart the investigation if warranted. The development could grant Trump greater influence over US monetary policy and leave him with more allies on the Fed board, particularly in regards to crypto industry regulations.
Senator Elizabeth Warren dismissed the move, calling it an attempt to install Warsh as Fed chair, while Senator Thom Tillis expressed support for Warsh, stating he would vote in favor of his confirmation once the DOJ dropped its investigation into Powell.