Trump Demands Fed Chair Resign, Rattling Crypto Markets

The conflict between President Donald Trump and Federal Reserve (Fed) Chair Jerome Powell has escalated to a new level, featuring public calls for resignation and harsh accusations. During a cabinet meeting on Tuesday, President Trump declared that Chair Powell should "resign immediately" if allegations that he concealed information from Congress are true.

The allegation relates to recent media revelations about issues within the Fed's headquarters renovation project, including rising costs and the use of allegedly luxurious furnishings. At a recent Senate hearing, Powell dismissed these reports, calling them "untrue and misleading." However, that did not stop President Trump from using it as grounds to increase pressure.

"He should resign immediately," Trump told reporters, emphasizing that misleading Congress is a valid reason for dismissal. The attack once again highlighted Trump's core criticism of Powell, whom he described as "absolutely terrible." The root cause of the conflict remains monetary policy. President Trump has repeatedly criticized the Fed for keeping interest rates too high, thereby harming the U.S. economy. "We need someone who will lower interest rates," Trump declared, reaffirming his desire to replace Powell with a more dovish successor.

This public confrontation between a sitting President and the head of the central bank is a rare event that raises deep concerns about the Fed's independence. For financial markets, including the crypto market, policy uncertainty from the world's largest economy is a significant risk factor.

The crypto market, seen as the highest-risk asset class, is particularly sensitive to these developments. The impact could be two-sided. On one hand, the prospect of Powell being replaced by a more dovish chair could be seen as a long-term positive for Bitcoin and other risk assets. On the other hand, the short-term chaos, political pressure, and erosion of trust in core U.S. financial institutions is an extremely strong "risk-off" signal. It could cause investors to sell off volatile assets like crypto to flee to safer havens.

Currently, all investors are closely watching this power struggle. Any subsequent moves will have a major impact on market sentiment and will shape the economic landscape in the near future.