Trump Denies Instigating Fed Chair Powell Subpoena—What It Means for Crypto Markets

Former President Donald Trump pushes back on claims he pressured lawmakers to subpoena Fed Chair Jerome Powell—just as crypto traders eye monetary policy shifts.

Political Pressure or Political Theater?

Trump’s denial lands amid swirling speculation about White House influence over the Federal Reserve. For crypto markets, the Fed’s independence—or perceived lack thereof—can swing Bitcoin’s price faster than a tweet. Powell’s every word gets parsed by algorithmic traders; a hint of dovishness sends decentralized finance volumes spiking.

Why Crypto Cares About the Fed

Easy money policies? Bullish for risk assets. Rate hikes? Watch altcoins tremble. The subpoena drama underscores a deeper tension: traditional finance’s political machinery versus crypto’s borderless ethos. When central bankers face political heat, smart contracts don’t flinch—but liquidity sure does.

The Regulatory Shadow-Boxing

While D.C. debates subpoenas, crypto builders deploy. Fed uncertainty often drives institutional interest toward non-sovereign stores of value—gold’s digital cousin, anyone? Yet, let’s be cynical: nothing moves markets like old-fashioned political drama wrapped in fiscal jargon.

Bottom line: political denials ripple through traditional and digital finance alike. Whether Trump influenced the subpoena matters less than the signal it sends—that monetary policy remains a political football. And when the Fed zigzags, crypto traders zag.

Powell says Fed will not bow to political intimidation

Video message from Federal Reserve Chair Jerome H. Powell: https://t.co/5dfrkByGyX pic.twitter.com/O4ecNaYaGH

— Federal Reserve (@federalreserve) January 12, 2026

Jerome Powell, who currently serves on the Fed’s Board of Governors, said the threats of a criminal indictment are not about his testimony before the Senate Banking Committee last June or the Fed buildings’ renovations.

He pointed out that this is about whether the Fed will continue to set interest rates based on economic indicators or political expediency, emphasizing that the Fed will not bow to political intimidation. 

“I have served at the Federal Reserve under four administrations, Republicans and Democrats alike. In every case, I have carried out my duties without political fear or favor, focused solely on our mandate of price stability and maximum employment. Public service sometimes requires standing firm in the face of threats.”

–Jerome Powell, Chair of the Board of Governors of the Federal Reserve System 

Powell said he will continue to do the job the Senate confirmed him to do, with integrity and a commitment to serving the American people. He added that he has deep respect for the law and the accountability in the U.S. democracy, noting that no one, including the Fed chair, is above the law.

Tillis claims Trump’s administration aims to end Fed’s independence

Republican Senator Thom Tillis of North Carolina criticized the subpoena, saying there is no doubt that the Trump administration is actively pushing to end the Federal Reserve’s independence. He also noted that, while there should now be no doubt about the Trump administration’s involvement in the subpoena, it is the credibility and independence of the Department of Justice (DOJ) that are now in question.

Tillis further emphasized that he will oppose the confirmation of any Fed chair nominees appointed by Trump until this matter is fully resolved. Meanwhile, Trump has confirmed his choice for the Fed chair, although he has yet to make it public. Among the leading contenders are former Federal Reserve Governor Kevin Warsh and WHITE House National Economic Council Director Kevin Hassett.

On the other hand, Federal Housing Finance Agency Director Bill Pulte is rumored to be the driving force behind the Fed subpoena. Trump is increasing pressure on the U.S. central bank through Pulte as he prepares to pick the next Fed chief, according to Bloomberg. 

However, a senior administration official has pointed out that although the FHFA head has been pushing controversial housing policy ideas and is investigating Trump’s enemies for mortgage fraud, it is the DOJ, not Pulte, that is behind the subpoena.

The senior official also added that some of Trump’s close allies were shocked by the subpoena, fearing that the legal fight targeting Fed chair Powell could upset the bond market. 

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