President Donald Trump once again attacked Federal Reserve Chairman Jerome Powell, calling him a "stubborn" person and blaming him for the decline in the U.S. housing market due to high interest rates. In a post on Truth Social, Trump accused Powell of refusing to cut interest rates, claiming this is costing the country $1 trillion a year and harming American families.
What does this mean for cryptocurrency?
Trump's latest statements add further political pressure on the U.S. central bank and the implications for cryptocurrency are noteworthy:
1. Greater pressure for interest rate cuts = Bullish trend for Bitcoin
Lower interest rates reduce the opportunity cost of holding non-yielding assets like Bitcoin. If Powell eventually succumbs to political and market pressure, this could trigger a surge in risk assets—including cryptocurrency.
2. Institutional money may flow into cryptocurrency
A pivot or even a dovish tone from the Fed has historically spurred the rally in stocks and digital assets. With institutions like BlackRock, Fidelity, and major banks eyeing cryptocurrency, interest rate cuts could accelerate their investment.
3. Cryptocurrency as a hedge against policy instability
Trump's tone emphasizes the unpredictability of fiscal and monetary policy. For many investors, cryptocurrency, especially Bitcoin, remains a risk hedge against central bank indecisiveness, inflation, and government monetary control.
Is the Fed about to change policy?
Although Powell has so far resisted calls for rate cuts, increasing political pressure—from the President himself—could change the landscape at the next FOMC meeting. If rate cuts are hinted at, the cryptocurrency market may lead this move.
The 2024–2025 cycle has proven that macro policy directly affects digital assets. Trump's direct involvement in this debate is another sign that cryptocurrency is no longer a niche market—it has now become part of the larger financial picture.
