Recently, the focus of the American political and financial markets has concentrated on an unprecedented power struggle—President Trump publicly threatened to fire Federal Reserve Chairman Jerome Powell, citing his "refusal to cut interest rates, which hampers economic growth." This conflict over the autonomy of monetary policy not only challenges the 70-year tradition of independence of the U.S. central bank but also prompts deep reflections on global financial stability and the direction of the cryptocurrency market: will cryptocurrencies like Bitcoin become new "safe havens" when the Federal Reserve potentially becomes a political tool, or will they fall into greater uncertainty?
Powell was nominated as Chairman of the Federal Reserve during Trump's term in 2018, at which time their relationship was amicable. However, as the Federal Reserve continued to raise interest rates between 2018 and 2019 to curb inflation, Trump began to frequently criticize Powell's policies for "hindering economic growth." He publicly stated, "The Federal Reserve is my biggest threat," and "They raised rates too quickly and are too slow to cut them."
This contradiction further intensified after the COVID-19 pandemic in 2020. Despite Powell adopting unprecedented loose monetary policies (including zero interest rates and unlimited quantitative easing), Trump still accused him of failing to effectively stimulate the economy. As 2024 approaches, with Trump being re-elected as president, their conflict reaches a peak.
Trump advocates for "radical interest rate cuts to stimulate the economy," arguing that the current benchmark rate is too high, leading to increased borrowing costs for businesses and pressure on the stock market. In a public speech on April 17, he bluntly stated, "Powell's economic policy is disastrous; he should cut rates immediately, or the U.S. economy will fall into recession." Powell, however, insists on the Federal Reserve's policy autonomy, emphasizing that interest rate decisions should be based on inflation data and employment market performance, refusing to yield to political pressure.
Behind this divergence lies a confrontation between two economic philosophies: Trump adheres to "short-term growth first," attempting to maintain stock market prosperity and economic hegemony through low interest rates; Powell follows an "inflation targeting" approach, believing that premature rate cuts may trigger the risk of stagflation. Meanwhile, after announcing the "reciprocal tariff" policy, global financial markets became turbulent, and the U.S. stock market experienced continuous declines, exacerbating Trump's anxiety and prompting him to adopt the extreme measure of a "dismissal threat." Recently, Trump publicly stated, "If I had a knowledgeable Federal Reserve Chairman, interest rates would have been cut long ago! I am very unhappy with him; if I want him out, he will leave very quickly, believe me."
In the face of the president's provocation, Powell has shown a rare tough stance. He subsequently responded, "According to U.S. law, the president has no authority to dismiss the Federal Reserve Chairman due to policy differences; even if asked to resign, I will never leave; I will serve my term until May 2026." According to the Federal Reserve Act, the term of the Federal Reserve Chairman is fixed at four years and can only be removed in cases of impeachment by Congress or serious misconduct; there is currently no precedent indicating that the president can bypass legal procedures to forcibly remove the Federal Reserve Chairman.
However, the Trump administration is trying to break this limitation through judicial means—its legal team cites a case currently being reviewed by the Supreme Court involving Trump's attempt to dismiss two Democratic members of the Federal Labor Commission, with the core dispute focused on whether the executive branch has the authority to intervene in personnel appointments of independent agencies. If the Supreme Court rules that the president has the right to replace officials of independent agencies who do not cooperate with policy, Powell's position may face a direct threat.
If Trump really forcibly dismisses Powell, it will overturn the tradition of central bank independence established since the 1951 Federal Reserve-Treasury Accord. Historical experience indicates that the politicization of central banks often leads to hyperinflation: during the "Great Inflation" period in the 1970s, Nixon's administration's intervention in the Federal Reserve caused inflation rates to soar to 13%. The current market fears that if Trump takes over the Federal Reserve, it may force the central bank to implement "unlimited quantitative easing," repeating the collapse of the Turkish lira.
The autonomy of the Federal Reserve is the core pillar of the U.S. dollar as the global reserve currency. If the Trump administration successfully intervenes in interest rate policy, it will convey the signal to the market that "U.S. monetary policy is subject to political manipulation," leading to a loss of confidence among international investors in dollar assets. On April 18, the dollar index fell by 0.8% after Trump's dismissal remarks, and the yield on 10-year U.S. Treasuries widened to 50 basis points, reaching a new high since the pandemic in 2020.
A more profound implication is that the global de-dollarization process may accelerate. Emerging market countries like Russia and India have already reduced dollar usage in cross-border trade; if the Federal Reserve loses its autonomy, these countries will have more reasons to turn to other reserve currencies or decentralized assets. Historical experience shows that whenever the credit of a sovereign currency collapses, gold and Bitcoin tend to experience explosive growth.
Data shows that the spot price of gold rose by 6.5% during the event's fermentation period, breaking through $3,355 per ounce, while Bitcoin's price rebounded from over $70,000 to over $80,000, indicating that the market is viewing both physical gold and digital gold as alternative options for "depoliticized assets."
In this regard, cryptocurrency analysts generally believe that a loss of autonomy for the Federal Reserve will amplify Bitcoin's "anti-political interference" advantage. When governments attempt to manipulate the money supply, Bitcoin's fixed inflation rate (approximately 1.7% per year) and decentralized issuance mechanism become scarce attributes. This is not speculation, but a hedge against the crisis of trust in currency.
More critically, the "strategic Bitcoin reserve" introduced by the Trump administration in 2024 (incorporating 200,000 seized Bitcoins into national reserves) objectively endows Bitcoin with the role of "quasi-official safe-haven asset," providing it with additional endorsement amid policy turmoil.
Furthermore, Trump's intervention in the Federal Reserve may indirectly accelerate other countries' establishment of "cryptocurrency safe havens." In April 2025, Hong Kong allowed Ethereum spot ETFs to include staking functions, and Canada launched a Solana spot ETF that also achieved "compliant staking earning." These cases show that when the traditional financial system is in turmoil, regulators are more inclined to mitigate risks through cryptocurrency innovations. If the politicalization of the U.S. central bank leads to capital outflows, jurisdictions friendly to regulation such as Singapore and Switzerland may accommodate more cryptocurrency assets, reshaping the global digital finance landscape.
However, despite the long-term positive logic, the cryptocurrency market still faces short-term selling pressure. During the "Silicon Valley Bank crisis" in 2024, Bitcoin was sold off due to the stock market crash, causing its price to plummet. Currently, the 30-day correlation coefficient between U.S. stocks and cryptocurrencies remains as high as 0.65; if Trump's threats trigger a collapse in the U.S. stock market, Bitcoin may be forced to "go down with the ship." On April 19, during trading, Bitcoin briefly fell below $80,000 as the S&P 500 index declined, indicating that the market's dependence on traditional finance has not been completely severed.
Overall, the conflict between Trump and Powell is essentially a fierce clash between the "political cycle" and the "economic cycle." When the traditional central banking system faces a crisis of trust, the rise of cryptocurrency is no longer merely a technological revolution, but a systemic change regarding the distribution of monetary power. If the autonomy of the Federal Reserve can be maintained, cryptocurrencies may continue to exist as "complementary assets"; however, if political interference disrupts the tradition of central bank independence, decentralized currencies like Bitcoin may encounter a "historic opportunity"—becoming a "digital shield" against the abuse of power by global capital.
The outcome of this game is still uncertain, but it has already revealed a key fact: in an era of retreating globalization and rising geopolitical tensions, the legitimacy of currency is no longer solely supported by national credit; the decentralized trust mechanism empowered by technology is reshaping the rules of value storage. Regardless of the final outcome, this "Federal Reserve crisis" in 2025 will serve as an important footnote for the mainstreaming of cryptocurrencies—it demonstrates that when institutional trust shows cracks, the trust system built by technology will ultimately be reexamined by the market.
Perhaps the true value of cryptocurrency lies not in replacing traditional finance but in forcing it to return to rationality: when monetary policy is no longer influenced by short-term political interests, and when central bank autonomy is rigidly protected by law, whether it is the U.S. dollar or Bitcoin, they can truly serve as "good money" for economic development. And this is the ultimate revelation that the current storm gives us.
