Trump's Potential Fed Chair Replacement Boosts Bitcoin Stability

Bitcoin remained stable on Friday as traders anticipated potential changes at the Federal Reserve. United States President Donald Trump is reportedly planning to replace Fed Chair Jerome Powell, a move that could alter the central bank’s approach to interest rates and market liquidity.

Markets are interpreting this as a signal. If Powell is replaced by someone more inclined to cut rates, risk assets like Bitcoin and Ethereum could benefit. The US dollar weakened to a three-year low, and bond yields decreased, suggesting that easier monetary policies may be on the horizon. For crypto investors, this scenario is worth monitoring closely.

Reports indicate that Trump is seriously considering replacing Powell before his term ends in 2026. Though no official announcement has been made, sources suggest that Trump has discussed potential successors with advisors. His criticism of Powell’s policies is not new, but recent inflation concerns and election-year pressure may be accelerating the timeline for a change.

The market responded swiftly. Traders began to anticipate a more dovish Fed policy, which typically means lower interest rates and increased liquidity. This would be favorable for crypto, which has struggled under tighter monetary conditions over the past year. Bitcoin, often used as a hedge against fiat debasement, tends to rally when the dollar declines and rates come down.

Bitcoin was trading at 106,950 on Friday, with a daily high of 107,250 and a low of 106,145. While this was not a significant breakout, it indicated rising interest. Ethereum and other top coins also saw similar quiet upward movements. Traders are proceeding with caution, aware that discussions about replacing the Fed chair are one thing, but actually implementing the change is another.

The bullish sentiment began with equities. The Dow surged more than 300 points, while the S&P 500 and Nasdaq also closed higher. Tech stocks led the rally, driven by falling Treasury yields and hopes that rate hikes are off the table for now. This optimism spilled into crypto markets, where risk sentiment plays a significant role.

There is still considerable uncertainty. Powell remains in office, and no formal replacement has been named. However, the fact that President Trump is considering the idea is already influencing markets. Crypto investors are particularly sensitive to changes in the macro outlook, and this could be a pivotal development.