The Republican senator from Wyoming has criticized the U.S. Federal Reserve for its role in Operation Choke Point 2.0 and is now calling for the Fed Chair to resign.
Lummis is ramping up pressure, calling for Powell to resign
Fed Chair Jerome Powell has had a tough year. He has been mocked by the president, accused of lying by Republican Congresswoman Anna Luna of Florida, and now Senator Cynthia Lummis of Wyoming, who calls herself the 'Queen of Cryptocurrency,' is demanding that he leave the central bank.
Powell has angered U.S. President Donald Trump, primarily because the Fed Chair is still reluctant to raise interest rates as inflation in the U.S. remains above the Fed's 2% target. Trump believes that raising interest rates is costly for the government, which is already paying over a trillion dollars just to service its $36.67 trillion debt.
But Lummis's grievances are not limited to interest rates. The billionaire from Wyoming has repeatedly accused Powell of facilitating the Biden administration's government-wide efforts to undermine the cryptocurrency industry, also known as 'Operation Choke Point 2.0.'
In addition to monetary policy, the Federal Reserve is also responsible for overseeing financial institutions to ensure that banking operations are 'safe and sound.' In its program to monitor U.S. banks, the Fed often incorporates a concept called 'reputational risk' to ensure that banks do not engage in activities that could be seen as negative.
Lummis accused the Fed of telling banks that cooperating with cryptocurrency companies would increase reputational risk, a stance that led to the elimination of dozens of cryptocurrency companies. However, after the Trump administration, which was friendly to cryptocurrency, took office earlier this year, the central bank decided to remove the reputational risk factor from the bank supervision process last month.
But that is still not enough for Lummis. In addition to eliminating reputational risk, she also wants Powell to be fired.
'Today, the Fed announced it will remove reputational risk from one factor in the bank supervision process. This is a victory, but there is still much work to be done,' Lummis wrote in a post on June 23 on X. 'Jay Powell has repeatedly demonstrated that he is not competent to run the Fed. He must resign immediately,' she posted on July 9.
Lummis, who is also the first chair of the Senate Banking Subcommittee on Digital Assets, has intensified her calls for Powell to resign. In a recent interview with Fox News, host Larry Kudlow asked Lummis why she wanted the Fed Chair to resign. She provided Kudlow with a list of issues related to Operation Choke Point 2.0 and bank supervision. She also mentioned allegations of Powell mismanaging the $2.5 billion renovation project of the Federal Reserve building, which has exceeded the budget by $700 million.
Lummis said, 'I think there is now enough evidence to show that he is no longer welcome.'