Bitcoin News Today: Who Holds the Keys to Bitcoin’s Fate: The Next Fed Chair?

Bitcoin’s price trajectory remains closely tied to evolving Federal Reserve (Fed) policy, particularly the anticipated shift in leadership under President Donald Trump. The selection of Trump’s nominee to replace current Fed Chair Jerome Powell—who is set to leave in May 2026—could significantly influence monetary policy and, by extension, the outlook for Bitcoin. Economist Alex Krüger has highlighted that the timing of Trump’s announcement will signal when a more dovish Fed policy may be priced into financial markets [1].

Powell’s term is nearing its end, and Trump has already begun narrowing down potential candidates, with speculation pointing to a shortlist of three to four names. Among those cited are figures such as Jefferies’ chief market strategist David Zervos and former Fed Governor Larry Lindsey [1]. Analysts argue that the choice of Fed Chair will shape the direction of U.S. monetary policy, with a dovish appointee likely to extend the current bull market cycle for Bitcoin by fostering lower interest rates and increased liquidity [1]. Krüger further notes that Bitcoin’s inability to sustain recent highs has led to profit-taking and a correction, but he remains confident that the cycle will continue if the Fed adopts a more accommodative stance [3].

The September Federal Open Market Committee (FOMC) meeting is a key focus as markets speculate on the first potential rate cut of the year. According to the CME FedWatch Tool, 83.9% of participants anticipate a 25 basis point cut in September [1]. However, recent economic data—particularly the July Producer Price Index (PPI), which surged by 0.9%—has tempered some of the optimism. Bank of America has revised its expectations, suggesting the Fed may hold rates steady for longer as it grapples with persistent inflation and the economic effects of Trump’s proposed trade policies [6].

The broader market is also reacting to the uncertainty. Bitcoin has pulled back from a recent high of $124,128 to approximately $115,150, and volatility across major asset classes remains low as investors await Powell’s Jackson Hole speech [5]. This event, which traditionally marks pivotal shifts in monetary policy, will likely shape the tone of the Fed’s upcoming decisions [6]. Analysts like Ryan Rabaglia and Greg Magadini emphasize the significance of Powell’s speech, noting that it could either reinforce expectations for a rate cut or signal a more hawkish stance, which would pressure Bitcoin further [2].

In the long term, Bitcoin’s performance is tied not just to immediate rate decisions, but to broader macroeconomic dynamics. If the Fed adopts a dovish stance, Bitcoin could benefit from a weaker dollar and a flight to alternative stores of value. Conversely, if the Fed resists political pressure and maintains tighter policy, the gradual erosion of U.S. macroeconomic credibility could still drive demand for Bitcoin as a hedge against systemic risk [4]. Analysts caution that while Bitcoin has been a beneficiary of low-volatility environments, the market remains at risk of complacency given the uncertainty surrounding inflation, tariffs, and the Fed’s political independence [5].

Source: [1] Bitcoin won't be 'priced in' until Trump announces new Fed ... (https://cointelegraph.com/news/bitcoin-price-factor-top-federal-reserve-chair-september-rate-cuts) [2] 'All Eyes' Are On This Week's Fed Gathering After Bitcoin ... (https://www.forbes.com/sites/digital-assets/2025/08/18/all-eyes-are-on-this-weeks-fed-gathering-after-bitcoin-suffers-pullback/) [3] Bitcoin Bull Run Hinges On Trump's Pick For Fed Chair (https://www.mitrade.com/insights/news/live-news/article-3-1052117-20250820) [4] All roads lead to inflation: Fed cut or not, Bitcoin may stand ... (https://cointelegraph.com/news/all-roads-lead-to-inflation-fed-cut-or-not-bitcoin-may-stand-to-gain) [5] Volatility Meltdown Everywhere as Powell's Jackson Hole ... (https://www.coindesk.com/markets/2025/08/17/volatility-vanishes-across-markets-as-traders-brace-for-powell-s-jackson-hole-speech) [6] Markets still price in September cut, but Powell in Jackson ... (https://fortune.com/2025/08/18/powell-jackson-hole-cut-preview-chances-lowering-inflation/)