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 lead the Fed, Kevin Warsh, one step closer to confirmation. Warsh, who has significant personal wealth, including assets in the cryptocurrency space, is awaiting a final Senate vote after a recent confirmation hearing. Trump, who has criticized Powell for high interest rates, chose Warsh to address this issue, but Senator Thom Tillis had vowed to block the confirmation as long as the DOJ's investigation into Powell continued. The probe, which was dropped on Friday, was related to cost overruns in a Fed building project.
US Attorney Jeanine Pirro stated that the DOJ has asked the Fed's inspector general to investigate the matter and issue a report. Following the news, the likelihood of Warsh's confirmation before May 15 increased significantly. Pirro noted that she will not hesitate to restart the investigation if the facts warrant it. Trump's ability to appoint his own people to the Federal Reserve would grant him greater influence over US monetary policy and provide him with more allies on the Fed board, particularly in regards to the crypto industry and stablecoin issuers.
Senator Elizabeth Warren criticized the move, calling it an attempt to clear the path for Warsh's confirmation, while Senator Tillis expressed his support for the nominee, stating that he would vote in favor of Warsh once the DOJ dropped its investigation into Powell.