Bitcoin And The 2026 Fed Shift: Expert Says Markets Aren’t Ready

Macro strategist Alex Krüger predicts a dramatic shift in the Federal Reserve's policies in 2026 due to potential personnel changes. He believes investors are underestimating how low US interest rates could fall under a Trump-aligned Fed led by Kevin Hassett. Krüger highlights Hassett's dovish stance, advocating for growth-first policies and aggressive rate cuts. He envisions Hassett being appointed as a Fed governor and then elevated to chair, alongside like-minded allies like Kevin Warsh. This new Fed configuration would likely prioritize growth over inflation, potentially leading to deeper rate cuts than currently anticipated. Krüger warns that Powell's continued presence on the board would create institutional challenges. He expects this shift to cause a "reflationary steepening" with front-end yields collapsing and long-end yields rising. This scenario is predicted to be highly bullish for risk assets like Bitcoin and gold, especially as Bitcoin transcends its current bearish psychology. Krüger expects Bitcoin to benefit from a crushed real discount rate and a multiple-expansion "melt-up." Krüger believes that the market is currently unprepared for this potential macro repricing in 2026.