The guessing game around who will replace Jerome Powell at the Federal Reserve is heating up, and the smart money appears to have a favorite. With Donald Trump reportedly ready to announce his pick as soon as next week, prediction markets are lighting up with activity.

Treasury Secretary Scott Bessent dropped a hint during a CNBC interview Tuesday, suggesting Trump could reach a decision "maybe as soon as next week." That timeline has betting markets working overtime.

The Front-Runner Emerges

According to data from Kalshi, a federally authorized prediction platform, more than $49 million has been bet on the contract "Who will Trump nominate as Fed Chair?" That's serious money riding on what amounts to educated speculation.

Kevin Warsh, a former Federal Reserve governor, is currently the betting favorite. His odds have climbed to 51%, up 4 percentage points recently. Rick Rieder, who serves as BlackRock's chief investment officer of global fixed income, trails as a distant second with 28% probability. Fed Governor Christopher Waller rounds out the top three at 12%.

Trump Keeps His Cards Close

In typical fashion, Trump is playing this one close to the vest. He told The New York Times that he's made his choice but isn't sharing it with anyone just yet. During a Wednesday night interview, he confirmed the decision is locked in, even if the name remains under wraps.

When asked about National Economic Council leader Kevin Hassett, Trump didn't commit but called him "certainly one of the people that I like." Not exactly a denial.

The Fed Chair decision arrives at a moment of particular tension between Trump and the central bank. The president has repeatedly clashed with current Chair Jerome Powell, at times threatening legal action over what he's characterized as incompetence. Bessent himself has taken shots at the Fed, criticizing the institution for substantial financial losses stemming from "mistimed asset purchases."

Meanwhile, Jamie Dimon, CEO of JPMorgan Chase & Co. (JPM), has taken himself out of the running for Fed Chair, though he's indicated he'd be open to serving as Treasury Secretary if asked.