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Bitcoin has stabilized below the $85,000 level during the past hours of trading on Friday, amid rising tensions between U.S. President Donald Trump and Federal Reserve Chairman Jerome Powell, which has added a new layer of uncertainty for investors.

Markets experienced a decline on Wednesday following hawkish remarks from Powell, who criticized Trump's tariff policy, warning that it could lead to an economic slowdown and rising prices, a phenomenon known economically as "stagflation." Powell clarified in his speech that his primary focus is currently on prices, indicating a shift towards a more stringent monetary policy than previously expected.

Trump, who nominated Powell to lead the Federal Reserve in his first term (and was then renewed by President Biden for a second four-year term), has expressed his displeasure with Powell since returning to the White House. However, Powell, who will remain in office until May 2026, has repeatedly affirmed his intention to complete his term, noting that the president does not have a legal basis to dismiss him.