Trump-Fed Spat Rattles Markets as Crypto Traders Eye Macro Risks
President Trump's escalating pressure campaign against Federal Reserve independence has drawn warnings from former central bank chairs and Wall Street executives. The public feud with Chair Jerome Powell over interest rate policy risks destabilizing inflation expectations - a key variable for crypto asset valuations.
Bitcoin (BTC) and ethereum (ETH) showed muted reaction to the political drama, maintaining recent ranges as traders await clearer signals on monetary policy. Stablecoins like DAI and USDC continue seeing elevated demand as hedges against potential dollar volatility.
The administration's push for aggressive rate cuts contrasts with crypto-native expectations of persistent inflation. DeFi yields on platforms like Aave and COMPOUND remain elevated compared to traditional fixed income, supporting the 'hard money' narrative for assets like BTC.
