Key Takeaways:
Trump’s Fed pick Stephen Miran cited a “third mandate” requiring the Fed to maintain moderate long-term interest rates.
This could justify yield curve control or more aggressive QE, weakening the dollar.
Analysts say the policy shift would be bullish for Bitcoin and crypto, with Arthur Hayes suggesting it could even send BTC to $1 million.
Forgotten Fed Mandate Resurfaces
The Federal Reserve has long been viewed as operating under a dual mandate — price stability and maximum employment. However, President Donald Trump’s latest Fed nominee, Stephen Miran, reignited debate earlier this month by citing a “third mandate” buried in the Fed’s founding documents.
The overlooked clause requires the central bank to pursue “moderate long-term interest rates” alongside its existing goals. For decades, this objective has been considered a byproduct of the first two mandates, but the Trump administration is reportedly eyeing it as legal cover for more aggressive bond market intervention.
Yield Curve Control on the Horizon?
Bloomberg reported Tuesday that the White House is weighing yield curve control (YCC) — direct intervention to cap long-term borrowing costs — as part of a new monetary strategy.
Potential tools include:
Expanded quantitative easing (QE)
Increased Treasury bill issuance
Bond buybacks and direct Fed purchases
The aim is to drive down Treasury yields and mortgage rates, cutting government borrowing costs as U.S. debt surpasses $37.5 trillion and stimulating housing markets.
Trump has repeatedly pushed for lower rates, criticizing Jerome Powell for being “too slow” in easing policy.
Why It Matters for Bitcoin
Analysts warn that active suppression of long-term rates would be financial repression by another name.
Christian Pusateri, founder of Mind Network, argued that YCC reflects a systemic imbalance:
“The price of money is coming under tighter control because the balance between capital and labor, between debt and GDP, has become unstable. Bitcoin stands to absorb massive capital as the preferred hedge against the global financial system.”
Arthur Hayes, co-founder of BitMEX, echoed the view, suggesting such policies could propel Bitcoin toward $1 million as investors flee a devalued dollar, according to Coinetelgraph.
