The term of current Federal Reserve Chairman Jerome Powell ends in May 2026.
But the very pro-Bitcoin President Trump wants to get ahead of finding his successor.
Meanwhile, the new president could take office as soon as his term begins next May.
US Treasury greenlights crypto over new Fed chairman?
Trump will likely choose a new Fed chairman by Christmas.
US Treasury Secretary Scott Bessent said on November 25:
“I think there is a very good chance that the president will make an announcement before Christmas.”
There was a big teaser about Bitcoin price markets in Bessent’s remarks for an interview on CNBC: “We’ve gotten to this point where monetary policy has become very complicated, and it’s not just about cutting rates. »
The price of Bitcoin rose following the news that Trump was set to choose his new Fed chairman. At the time, a school of Bitcoin whale buyers was behind this wave. But now, after the dust has settled and a few weeks after Bessent’s comments in November, here are four reasons why Bitcoin bulls could come to play following the appointment of a new Fed chair.
Trump supports low interest rates
President Trump is known to be very accommodating.
He is extremely supportive of a low interest rate policy from the Fed to stimulate growth. Some economists disagree and believe that low interest rates lead to misuse and waste of capital.
But Trump believes the economy does not have enough dollar liquidity to meet the needs of the enormous number of businesses and consumers and their rapid growth in the Internet age.
Stock and crypto markets were hesitant in the fourth quarter over whether the Fed would cut rates again in December – which currently seems almost a certainty.
In fact, Trump has been unusually vocal for the president’s office, publicly berating and bullying Powell and Janet Yellen for not pushing rates as low as he thinks they should be set.
He even recently threatened to fire Bessent if the Treasury secretary didn’t persuade Powell and the FOMC to cut rates again in December.
So a Fed chair appointed by Trump would certainly reflect his views on US lending rates.
This is good for the price of Bitcoin because of its supply/demand ratio. The multi-year view of the US interest rate target and cryptocurrency paints a very clear picture.
When rates rise, the price of Bitcoin collapses. When they go down, BTC goes up.
Trump is also pro Bitcoin
Additionally, President Trump isn’t just in favor of low interest rates.
He is also very pro-Bitcoin.
In March, Trump said in an article on Truth Social: “A U.S. crypto reserve will elevate this critical industry…I will ensure that the United States is the crypto capital of the world.” »
In a more recent Nov. 2 “60 Minutes” interview on CBS News, Trump said:
“I only care about one thing: Is crypto going to be number one in America? Because in crypto, it’s the kind of industry where basically you’re going to have number one and you’re not going to have number two.”
Furthermore, the president added:
“I want to make crypto great for America. That’s the only thing (…) Because right now we’re number one by far. I want to keep it that way.”
The Fed plays a central role in providing guidance and supervision to its member banks like JP Morgan and Bank of America Merrill Lynch as they offer Bitcoin products to investors.
The president strongly emphasized to the markets that he was prioritizing Bitcoin and cryptocurrencies. Thus, Trump’s choice to head the Fed will likely have a real impact on the financial sector, thereby increasing the value of Bitcoin.
Fed Chairman’s Pick Is Likely Pro-Crypto
Kevin Hassett, director of the US National Economic Council, is at the top of Trump’s short list.
He has close ties to crypto through his work at the White House Economic Council.
Some media outlets have even called Hassett a “crypto super bull,” but it is important to see if this will be followed if he is elected as the new president.
Wall Street will continue to take risks
Spot Bitcoin ETFs have a huge impact on the price of Bitcoin.
Like cryptocurrency markets, Wall Street stock markets turn bullish when the Fed lowers interest rates. The influx of new dollars through institutions raises the entire sea level for asset prices.
Since the launch of spot Bitcoin ETFs in January 2024, there has been a persistent and very close positive correlation between ETF flows and Bitcoin price movements up or down on the chart.
And Wall Street loves these Bitcoin spot funds.
The article 4 Ways Trump’s New Fed Chairman Could Raise the Price of Bitcoin appeared first on CryptoPotato.
