The independence of the US Federal Reserve is in the news again this week after Chairman Jerome Powell publicly criticized political pressure from President Donald Trump.
According to analysts, the recent Department of Justice (DoJ) investigation into Powell could ultimately benefit safe havens like gold and emerging alternatives like Bitcoin. [BTC].
Powell pushback from the Fed
For Powellthe investigation into the renovations of the Federal Reserve buildings was a “pretext.” He said Trump was coming after him for failing to aggressively cut interest rates to meet the president’s demands.
“The threat of criminal prosecution is a result of the Federal Reserve setting interest rates based on our best estimate of what will benefit the public, rather than following the president’s preferences.”
He vowed to fight back against what he saw as “intimidation” against the central bank. He added:
“This is about whether the Fed will be able to continue setting interest rates based on evidence and economic conditions – or whether monetary policy will instead be driven by political pressure or intimidation.”
Fed’s crisis and impact on BTC
After Powell’s statement, BTC immediately rose from $90.5k to over $91k, while the US dollar index (DXY) fell slightly.
According to analysts at Presto Research, “compromised Fed independence” would fuel demand for alternative safe havens.
Source: Presto Research/X
In April 2025, Trump threatened to fire Powell BTC recovered while US stocks sold off. Similar reports triggered the same market reactions later in 2025, making BTC, like gold, a ‘safe haven’.
With the battle between the Fed and Trump culminating in a formal investigation into Powell in 2026, analysts believe past trends are likely to repeat themselves.
In an email statement to AMBCrypto, Eliézer Ndinga, Global Head of Research at 21Shares, said:
“Recent comments from Jerome Powell on the importance of preserving central bank independence highlight how essential trust and transparency are to modern monetary policy.”
He added:
“In that context, Bitcoin continues to evolve as an emerging store of value with features that complement rather than compete with traditional financial systems.”
For his part, Farzam Ehsani, CEO of cryptocurrency exchange VALR, told AMBCrypto that the escalating conflict between the White House and the Fed was a “worrying precedent.”
He called for caution in the coming weeks, noting that:
“Investors should be extremely cautious in the coming weeks. The crypto market could react sharply to the outcome of the conflict.”
But if the White House wins, it could spark a huge BTC rally, Ehsani added.
“If the Fed remains firm, the market could return to the fundamental scenario. If the White House manages to push through a rate cut and launch stimulus, Bitcoin and gold could rise.”
Final thoughts
- Regardless of the outcome of the Fed-Trump conflict, analysts believe this would benefit BTC as a “safe haven.”
- In 2025, a similar escalation fueled a gold rally and alternative stores of value such as BTC and silver.