A political storm brews as current President Donald Trump eyes Federal Reserve Chair Jerome Powell’s removal by May 2025, a move analysts claim could catapult Bitcoin to $150,000. With Trump’s team pushing aggressive rate cuts and global markets fearing, the stakes for the U.S. economy and crypto have never been higher.
Trump’s Fed Feud Escalates
Trump’s disdain for Powell isn’t new. Since 2018, he’s slammed the Fed chief as “too slow” on rate cuts. Now, back in office, Trump isn’t just criticising; he’s acting. On April 17, 2025, he demanded Powell’s “termination,” blaming restrictive rates for stifling growth. His allies argue global competitors, like the ECB, have slashed rates seven times since mid-2024, while the Fed managed only one.
Furthermore, Trump’s tariffs on 185 nations aim to fund domestic projects, creating what he calls “room for rate cuts.” Critics, however, warn this gamble risks inflation and global backlash.
Global Rate Wars Heat Up
The ECB’s aggressive easing contrasts sharply with the Fed’s caution, fuelling Trump’s frustration. He claims the U.S. lags as rivals devalue currencies to boost exports. To counter, Trump’s tariffs target $50 billion in annual revenue cash he insists offsets inflation risks from rate cuts.
Yet, Japan’s Finance Minister Katsunobu Kato warns of trade chaos, while luxury brands like Hermès hike U.S. prices. A Tax Foundation report estimates tariffs could shrink GDP by 0.8%, amplifying Powell’s inflation concerns.
Powell’s Defiance Sets Stage for Crisis
Powell isn’t backing down. At an April 16 Chicago economic forum, he called Trump’s tariffs “inflationary” and vowed to resist political pressure. “Our decisions are data-driven, not politics-driven,” he asserted. Legal experts note Powell’s term lasts until 2026, and he’s vowed to fight removal.
This is followed by a looming constitutional clash. Trump’s legal team asks the Supreme Court to overturn a 1935 precedent shielding independent agency heads from political firings. A ruling in Trump’s favour could let him oust Powell early, reshaping Fed independence.
Dollar’s Future Hangs in Balance
The Fed’s independence has underpinned dollar stability since the 1970s. Trump’s push to control monetary policy alarms economists, who fear eroded global trust. “When confidence in the dollar fades, investors flock to Bitcoin and gold,” notes VanEck’s Matthew Sigel.
Indeed, Bitcoin surged 50% post-Trump’s 2024 election win, partly due to his pro-crypto policies. His March 2025 order creating a strategic Bitcoin reserve further signals support. Still, analysts caution that political meddling could spike Treasury yields and destabilise markets.
Bitcoin: Safe Haven or Speculative Bet?
Trump’s potential Fed overhaul has crypto bulls buzzing. Lower rates typically weaken the dollar, lifting risk assets like Bitcoin. Analysts speculate a May 2025 rate cut post-Powell might trigger a rally. “$150K isn’t absurd if the Fed loosens policy,” says Bitwise’s Hunter Leon.
However, short-term risks loom. Bitcoin recently mirrored stock dips during tariff turmoil. If Powell’s exit sparks panic, Bitcoin could nosedive before rebounding. Skeptics also note reaching $150K by May requires unprecedented inflows, a tall order amid volatility.
Market Fears On Long-Term Bets
Investors brace for the Fed’s May 6–7 meeting, which could greenlight Trump’s rate cuts. Stocks inch upward cautiously, but the dollar wobbles as uncertainty persists. Gold hits record highs, signalling safe-haven demand.
Ultimately, Trump’s power play transcends Powell it’s a test of institutional resilience. While Bitcoin may win long-term, immediate turbulence could shake even the boldest investors. As the Supreme Court weighs in, one truth emerges: In Trump’s economy, volatility is the only certainty.
