Meet Jerome Powell, the Chairman of the Federal Reserve and a pivotal figure in the financial system. Known for his influence, he has the power to send Bitcoin ($BTC) soaring or crashing within seconds. Powell's decisions shape not only the U.S. economy but also the global cryptocurrency landscape, raising questions about whether the Fed might someday adopt Bitcoin—or shut crypto down for good.
Powell's Role in Crypto's Turbulence
Appointed by Donald Trump in 2018, Powell was seen as a competent leader with deep experience in finance and governance. While Trump was not particularly crypto-friendly, Powell managed to maintain a cautious and critical stance on digital assets. Despite acknowledging blockchain's potential, he consistently highlights crypto's risks, including volatility and fraud.
Notably, after the collapse of FTX, Powell became more vocal about the need for tighter regulations. His speeches often trigger massive market reactions, as evidenced by the -15% drop following one of his recent addresses.
FOMC Meetings: Market Movers
Let’s examine the Federal Open Market Committee (FOMC) meetings for insight into Powell's influence:
November 7 Meeting: Interest rates were cut by 25 bps, causing minor market volatility. With no major negative announcements, the market rallied slightly.
Last Meeting: Powell's statement that the Fed isn't allowed to hold Bitcoin and has no plans to expand reserves led to an instant 7% $BTC drop.
2025 Outlook: Volatility Ahead
Powell’s policies suggest fewer interest rate cuts in 2025, indicating heightened market volatility this year. However, Powell predicts 2025 will be more stable, offering hope for long-term investors.
The Big Question: Will Powell Be Replaced?
Unlikely. Despite occasional criticism, removing a Fed Chair "for cause" is rare to maintain the institution's independence. Trump, who reappointed Powell, recently confirmed he wouldn’t fire him before his term ends in 2026.
Powell's Impact on Bitcoin's Future
While Powell remains cautious about crypto, his decisions indirectly shape its trajectory. His influence is undeniable, making him one of the most watched figures in the financial world.
Key Takeaway
Powell’s speeches and policies are a double-edged sword for crypto. While they bring challenges, they also highlight the growing relevance of digital assets in the global financial system.
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