President Donald Trump wants the Federal Reserve to slash rates, even to zero. That’s the president wish. Last year, he even made it clear that Jerome Powell was not his ideal chair. Trump wants someone to do as the executive wishes.
The hindrance is: The Fed is an independent entity and Powell is data-guided, so the FOMC says. Inflation and how the labor market performs matter more than what politicians desire.
In 2026, the Fed might not even slash rates. This was their message in the last meeting. The BTC USDT price has, as a result, been struggling for momentum, dragging top Solana meme coins in the process.
For traders, however, there is relief.
The Bitcoin price jumped about +2% on Sunday after Jerome Powell pushed back against a fresh political attack from Trump.
Video message from Federal Reserve Chair Jerome H. Powell: https://t.co/5dfrkByGyX pic.twitter.com/O4ecNaYaGH
— Federal Reserve (@federalreserve) January 12, 2026
The move lifted BTC USD prices just above $90,000 before cooling. This comes as investors watch rising tension between the White House and the central bank.
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Trump Heaping Pressure on The Fed, Powell Responds
That BTC USD price pop might look random.
It wasn’t.
Bitcoin often reacts fast when traders worry about political pressure on money policy.
For everyday investors, this moment explains why Bitcoin behaves less like a tech stock and more like a hedge against political risk.
Over the weekend, Powell responded publicly after the Justice Department served the Fed with subpoenas tied to his past testimony.
The Fed chair believes he’s being targeted for not allowing the president to have his way.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President. This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political pressure or intimidation.”
Trump has demanded faster and deeper rate cuts, while Powell has held a firmer line.
In plain English, the president wants cheaper money to boost the economy. The Fed controls interest rates and usually operates without political orders. When that independence looks shaky, markets react.
No modern US president has pushed this hard against a sitting Fed chair. That alone raises eyebrows on Wall Street.
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With the Fed and Powell responding publicly, it remains to be seen how Trump will react and how the central bank will proceed.
The next few weeks will be definitive.
If the “thermostat”, in this case, the Fed, cracks, it means politicians have taken over the control of inflation and USD’s strength.
If Donald Trump is able to successfully imprison Jerome Powell on the basis of spending too much on a building remodel, I’m pretty sure my wife is going to get the electric chair
— BuccoCapital Bloke (@buccocapital) January 12, 2026
The market will likely interpret that as bearish for the economy, providing tailwinds for risk assets like Bitcoin and some of the hottest meme coins.
Gold and silver will also likely stretch gains.
In April 2025, Bitcoin surged past $87,000 as similar pressure on the Fed pushed the greenback lower.
Given the “beef” between Trump and the Fed, Bitcoin will be closely watched.
Increasingly, Bitcoin is playing a central role in US politics more than ever. The launch of the US Strategic Bitcoin Reserve tied national policy directly to BTC.
That changes how investors read headlines.
When trust in institutions weakens, Bitcoin trades more like digital gold than a risky tech bet.
After what Trump just did to Jerome Powell, I can officially say we are in a banana republic
— Isaiah Martin (@isaiahrmartin) January 12, 2026
You can see this play out across the market.
Gold hit record highs earlier in similar moments, while the BTC USD price followed with sharp but shorter rallies.
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