He can't take down the Fed. It would hurt everyone. He could change it, but an overnight elimination would destroy the global economy. As much as we dislike the institution, it has too many critical functions to just explode.
Potus has known Mnuchin for ~15 years. Mnuchin was a Bankster with Goldman then left to build his own businesses. The banks are not coming down. He needs someone hyper-loyal who can navigate those shark infested waters to freeze the assets without any gamesmanship. Frozen assets typically stay with whatever institution is the custodian of the assets until due process has occurred. If they are to be forfeited or seized, they go into a DoJ or US Treasury Trust account.
This is serious power. America is a nation of laws and if we abuse it, no one will be investing in America, foreign or domestic.