Photo by Tejaswin Gundala on Unsplash
If you’ve been following the latest buzz around the Fed, Trump, and the crypto world, you know there’s a heated debate about whether Fed Chair Jerome Powell should be fired—and what that could mean for Bitcoin and Ethereum. Today, I want to dive deep into this topic, clear up some misconceptions, and explain why this matters not just for traditional finance but for crypto enthusiasts like you and me.
Plus, Ethereum just made some impressive moves recently, and I’ll break down what’s driving that surge and whether altcoin season might be just around the corner.
The Fed, Jerome Powell, and Trump: What’s Really Going On?
There’s been a lot of chatter about whether President Trump will fire Jerome Powell, the Fed Chair. Rumors even had markets reacting overnight. But before we jump to conclusions, let me explain why this story is more complicated than it seems.
First, it’s important to understand what the Federal Reserve (the Fed) and Jerome Powell’s role actually are. His main job? Keep inflation in check and maintain healthy employment levels. That’s it. It’s not about controlling government spending or the deficit—that’s Congress’s job.
Here’s the crux: after the COVID crisis, the government printed a ton of money—like 30 to 40% more in money supply. Naturally, that leads to inflation. Powell responded by hiking interest rates aggressively to slow down borrowing and spending. The idea is simple: if people and businesses borrow less because it’s expensive, they spend less, which helps cool inflation.
On the flip side, if the economy is sluggish and you want to boost activity, you cut rates, making borrowing cheaper and encouraging spending. But the trade-off? More inflation.
Why Trump Wants Powell to Cut Rates
Trump has been vocal about wanting Powell to cut interest rates—he even called Powell “stupid” and sent him a hand-written letter pushing for cuts up to 3 percentage points (or 300 basis points). The reasoning? Every percentage point cut supposedly saves the government about $300 billion, mostly on bond interest payments.
That’s a huge potential saving if true—cutting 3 points could mean a trillion dollars saved. But here’s the catch: cutting rates now could backfire because inflation is actually ticking up, thanks to tariffs, oil prices, and other global factors. If Powell cuts rates while inflation is rising, it risks sparking even more inflation, which is exactly what Powell is trying to avoid.
Powell’s Dilemma: Inflation vs. Jobs
Powell’s balancing act is choosing between fighting inflation or saving jobs. Right now, job data is stable—not terrible—so he’s prioritizing inflation control. That’s why, despite Trump’s pressure, the Fed is unlikely to cut rates immediately. Markets currently see zero chance of a rate cut this month, but over 50% chance in September.
Also, firing Powell could create serious global financial instability. The U.S. financial system influences markets worldwide, and abrupt leadership changes at the Fed could cause chaos. Economists and former Fed chairs alike warn that firing Powell now would be the worst move.
Why This Matters for Bitcoin and Crypto
The whole Fed drama highlights why Bitcoin is gaining traction as a hedge against financial uncertainty. The U.S. government’s irresponsible spending and ballooning deficits mean more borrowing and debt interest. Bitcoin, with its capped supply and decentralized nature, is attracting institutions and retail investors alike as a store of value.
Right now, Bitcoin is hovering around $119K (note: this is likely a typo or shorthand in the video, but the key point is it’s close to its all-time high). It’s only about 3,000 points away from breaking its previous peak—something that could happen any day now given the current buying momentum.
Institutions understand the risks tied to Fed policies, bond markets, and inflation, and they’re buying Bitcoin as a way to protect themselves. This growing adoption is driving endless buying pressure.
Ethereum’s Surge: What’s Behind the Pump?
Ethereum has also had a great week, with a 6-7% jump recently. Two main reasons are fueling this rise:
- Hope Around the Genius Bill: This bill relates to stablecoins regulation, and if passed, it would be a huge positive for Ethereum since USDC and USDT—the two biggest stablecoins—are primarily built on the Ethereum network.
- Big Backers Entering the Scene: Tom Lee, a well-known crypto analyst, revealed a project holding $500 million worth of ETH, similar to MicroStrategy’s Bitcoin strategy but for Ethereum. Plus, a prominent Silicon Valley investor bought a 9% stake in this project. BlackRock’s Ethereum ETF is also seeing massive inflows.
While Ethereum has competition from newer blockchains that claim to be faster or cheaper, it still holds the top spot for total value locked (TVL) and stablecoin activity. Its “death” has been greatly exaggerated, and with institutional interest growing, Ethereum might just lead us into altcoin season.
Conclusion: What Should You Do?
Understanding the Fed’s role, Powell’s dilemma, and the political drama helps you see why Bitcoin and Ethereum are more relevant than ever. The Fed’s focus on inflation control means interest rates will likely stay high for now, keeping pressure on traditional markets.
That’s why crypto, especially Bitcoin and Ethereum, are gaining momentum as alternative stores of value and investment opportunities. Whether you’re a seasoned trader or just curious, now’s a good time to stay informed and consider how crypto fits into your portfolio.
And if you want to learn how to trade crypto effectively, check out Crypto Pulse’s free boot camp—a week-long course designed to take you from beginner to confident trader. You can enroll at cryptosrus.com/bootcamp. Whether you want to master fundamentals, technical analysis, or advanced strategies, this is a great resource to get started.
Stay sharp, keep an eye on the markets, and remember—the crypto world moves fast, but with the right knowledge, you can move faster.
Should Trump Fire Jerome Powell? | Ethereum Pumps and What It Means for Crypto and Bitcoin. There are any Should Trump Fire Jerome Powell? | Ethereum Pumps and What It Means for Crypto and Bitcoin in here.
