Donald Trump is making a strong push against Federal Reserve Chairman Jerome Powell — and this chaos could have significant consequences for cryptocurrency.
The President of the United States has expressed frustration multiple times over Powell's refusal to cut interest rates and wants this economist to resign before his term ends in May 2026.
In an aggressive post on Truth Social, Trump escalated tensions by stating: "The firing of Powell cannot happen fast enough."
However, some close associates of the president, including Treasury Secretary Scott Bessent, have warned that his dismissal could further destabilize the financial markets.
A deadlock is emerging. While Trump has suggested that Powell would step down if asked, the head of the Fed has asserted that this is not the case.
At this point, we should consider the reasons why the White House does not have the authority to fire the head of the U.S. central bank. A chairman can only be fired for just cause — and the Fed is supposed to be independent and free from political interference.
But it is clear that Trump is determined to change all of this. After he fired senior officials at two independent agencies, the Supreme Court is considering whether they should be reinstated. If the lawsuit favors the president, theoretically, it could allow him to assert control over the Fed and oust Powell from the industry.
Bessent is not the only one worried about the impact of this on the U.S. economy. Senator Elizabeth Warren, a critic of Trump and a deep skeptic of cryptocurrency, has warned that Wall Street will collapse if presidents have this kind of power.
She told CNBC that giving important economic levers "to a president who just wants to wave a magic wand" would make America "hard to distinguish from any other run-of-the-mill dictatorship in the world."
It can be said that investors have panicked after the endless tariff rounds, whether or not it should be the case for major economies. The strong sell-offs have significantly weakened the dollar. This not only reduces profits for foreign companies selling products in the U.S. but also makes imported goods more expensive for domestic consumers.
The last time the Fed cut interest rates was in December 2024, with Powell continuously stating that he wanted convincing evidence of inflation cooling down before proceeding again. In comparison, the European Central Bank has cut the main interest rate three times so far in 2025 — and this is the source of Trump's frustration.
Despite all these instabilities, there are still those who argue that a declining dollar could benefit Bitcoin in the medium to long term. Real Vision founder Raoul Pal has long believed that a weaker dollar will encourage investors to seek to preserve their wealth through alternatives like BTC.
However, this has not yet been reflected in the recent price movements. Until last year, Bitcoin would typically rise whenever the US dollar index fell. But despite the DXY dropping 8.5% this year — the worst performance since 2005 — BTC is also facing a loss of 9.5%.
If Trump succeeds in his desire to fire Powell and if this move causes the stock market to plummet, it is very likely that Bitcoin will also drop - as stocks and cryptocurrencies have recently shown a strong correlation.
Looking beyond BTC, a recent article from the New York Times by Economic Security Project chairman Chris Hughes warns that American consumers should pay close attention to Trump's attacks on the Fed. He wrote:
"The U.S. government will face significantly higher borrowing costs for the trillions they need in the coming years. Household budgets will also be affected by higher borrowing costs and rising inflation."
Hughes continues to warn that — even if Trump's term ends — consumer prices could still skyrocket out of control, while the position of the dollar as the world's reserve currency is almost evaporating.
At this stage, Bitcoin enthusiasts will argue that this is a good thing. They will point out how consumers in Latin American countries devastated by hyperinflation have turned to BTC to preserve their wealth. And they will emphasize that such a move could strengthen the narrative of Bitcoin as an inflation hedge.
But let’s make one thing clear: it is impossible to know exactly how Trump’s campaign against Jerome Powell will end — and what impact it will have on the cryptocurrency market. In just a short span of three months, traders have been surprised multiple times… from the president’s refusal to buy new BTC for strategic reserves, to his move to make a strong push for tariffs against China being worse than expected.
There is no guarantee that this will bring positive benefits to Bitcoin.
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What Trump's Attacks on Jerome Powell Could Mean for Cryptocurrency
Donald Trump is making a strong push against Federal Reserve Chairman Jerome Powell — and this chaos could have significant consequences for cryptocurrency. The President of the United States has expressed frustration multiple times over Powell's refusal to cut interest rates and wants this economist to resign before his term ends in May 2026. In an aggressive post on Truth Social, Trump escalated tensions by stating: "The firing of Powell cannot happen fast enough."
However, some close associates of the president, including Treasury Secretary Scott Bessent, have warned that his dismissal could further destabilize the financial markets. A deadlock is emerging. While Trump has suggested that Powell would step down if asked, the head of the Fed has asserted that this is not the case. At this point, we should consider the reasons why the White House does not have the authority to fire the head of the U.S. central bank. A chairman can only be fired for just cause — and the Fed is supposed to be independent and free from political interference. But it is clear that Trump is determined to change all of this. After he fired senior officials at two independent agencies, the Supreme Court is considering whether they should be reinstated. If the lawsuit favors the president, theoretically, it could allow him to assert control over the Fed and oust Powell from the industry. Bessent is not the only one worried about the impact of this on the U.S. economy. Senator Elizabeth Warren, a critic of Trump and a deep skeptic of cryptocurrency, has warned that Wall Street will collapse if presidents have this kind of power. She told CNBC that giving important economic levers "to a president who just wants to wave a magic wand" would make America "hard to distinguish from any other run-of-the-mill dictatorship in the world." It can be said that investors have panicked after the endless tariff rounds, whether or not it should be the case for major economies. The strong sell-offs have significantly weakened the dollar. This not only reduces profits for foreign companies selling products in the U.S. but also makes imported goods more expensive for domestic consumers. The last time the Fed cut interest rates was in December 2024, with Powell continuously stating that he wanted convincing evidence of inflation cooling down before proceeding again. In comparison, the European Central Bank has cut the main interest rate three times so far in 2025 — and this is the source of Trump's frustration. Despite all these instabilities, there are still those who argue that a declining dollar could benefit Bitcoin in the medium to long term. Real Vision founder Raoul Pal has long believed that a weaker dollar will encourage investors to seek to preserve their wealth through alternatives like BTC. However, this has not yet been reflected in the recent price movements. Until last year, Bitcoin would typically rise whenever the US dollar index fell. But despite the DXY dropping 8.5% this year — the worst performance since 2005 — BTC is also facing a loss of 9.5%. If Trump succeeds in his desire to fire Powell and if this move causes the stock market to plummet, it is very likely that Bitcoin will also drop - as stocks and cryptocurrencies have recently shown a strong correlation. Looking beyond BTC, a recent article from the New York Times by Economic Security Project chairman Chris Hughes warns that American consumers should pay close attention to Trump's attacks on the Fed. He wrote: "The U.S. government will face significantly higher borrowing costs for the trillions they need in the coming years. Household budgets will also be affected by higher borrowing costs and rising inflation." Hughes continues to warn that — even if Trump's term ends — consumer prices could still skyrocket out of control, while the position of the dollar as the world's reserve currency is almost evaporating. At this stage, Bitcoin enthusiasts will argue that this is a good thing. They will point out how consumers in Latin American countries devastated by hyperinflation have turned to BTC to preserve their wealth. And they will emphasize that such a move could strengthen the narrative of Bitcoin as an inflation hedge. But let’s make one thing clear: it is impossible to know exactly how Trump’s campaign against Jerome Powell will end — and what impact it will have on the cryptocurrency market. In just a short span of three months, traders have been surprised multiple times… from the president’s refusal to buy new BTC for strategic reserves, to his move to make a strong push for tariffs against China being worse than expected. There is no guarantee that this will bring positive benefits to Bitcoin.