Bitcoin (BTC) has surpassed the $93,000 threshold in the early hours of the Asian trading session on Wednesday. This display of strength occurred after President Trump expressed his views on discussions about replacing Federal Reserve (Fed) Chairman Jerome Powell.
In recent months, this pioneering cryptocurrency has shown an increasingly strong correlation with broader economic and political issues. This indicates that macroeconomic factors are increasingly influencing Bitcoin.
Trump Has No Intention of Firing Powell
Less than a week ago, BeInCrypto reported that changing the Fed chair was inevitable. This occurred against the backdrop of economic tensions caused by Trump's tariffs.
This report followed an announcement by Treasury Secretary Scott Bessent that the Trump administration was planning to interview candidates to replace Jerome Powell.
Reports about the conflicting views between Trump and Powell regarding interest rate cuts had fueled this idea. On one side, Trump wants the Fed to cut rates to protect Americans from the impact of trade wars.
"The Fed would be doing so much better if they cut rates as America's Tariffs are having a big positive impact (& will continue) on our Economy," Trump wrote on Truth Social.
On the other hand, Powell emphasized a cautious approach to monetary policy decisions, refusing to make further rate cuts. The Fed has also made significant adjustments to its 2025 economic forecast.
These conflicting views had sparked speculation that Jerome Powell's position as Fed chair was at risk. However, in a recent development, Trump declared that he does not plan to fire Powell.
"I have no intention of firing him... I want to see him be more active in lowering rates," Reuters reported, quoting Trump speaking to reporters in the Oval Office on Tuesday.
Immediately after, Bitcoin surpassed the $93,000 mark. At the time of writing, BTC is trading at $93,136, up nearly 6% in the past 24 hours.
Bitcoin (BTC) Price Performance. Source: BeInCryptoNotably, Jerome Powell has about 13 months remaining in his term as Federal Reserve Chairman.
Bitcoin Benefits from Declining Government Trust
BitMEX founder and former CEO Arthur Hayes commented on the quick market reaction to this topic on the Bitcoin price chart.
"Trump says wants to fire JAYPOW – dollar down, BTC up. Trump says no intention to fire JAYPOW – dollar up, BTC up more," Hayes joked.
This comment highlights the market's sensitivity to political instability in 2025. Looking back, the US Dollar Index (DXY) recently dropped to a 3-year low, due to pressure from President Trump wanting to remove the Fed chair.
Simultaneously, Bitcoin has increased in value as investors see it as a potential hedge against a weakening dollar and inflationary pressures.
As Trump's views cause market volatility, the dollar's fluctuation is a positive signal for Bitcoin, reflecting its attractiveness as a hedge against traditional finance (TradFi) instability.
BeInCrypto reported this situation in a recent US Crypto News publication, citing Geoff Kendrick, Head of Digital Assets Research at Standard Chartered.
According to Kendrick, Bitcoin is increasingly seen as a hedge against TradFi risks and US Treasury Bonds.
"I think Bitcoin is a hedge against both TradFi and US Treasury risks. The threat of removing the US Federal Reserve Chairman Jerome Powell belongs to Treasury risk – so the hedge is being implemented," Kendrick told BeInCrypto.
Meanwhile, Nate Geraci, president of ETF Store, noted that Bitcoin is benefiting from the erosion of trust in government and politicians, which is driving people to seek alternatives.
"Bitcoin is one of the biggest winners from events in the past few weeks in my view, at least from a philosophical standpoint. The erosion of trust in government and politicians will drive people to seek alternatives. Not saying that's good or bad, but just think about it logically," Geraci commented.
