Bitcoin rose to $120,000 before retracing slightly, followed by reports that U.S. President Donald Trump may be preparing to remove Federal Reserve Chair Jerome Powell.
The speculation triggered an immediate market reaction, with traders anticipating a shift in monetary policy direction. Trump has repeatedly urged the central bank to lower interest rates, a move considered supportive of Bitcoin and other cryptocurrencies.
According to a Bloomberg report citing a White House official, Trump has discussed the possibility of replacing Powell with congressional Republicans.
The news came just a day after the U.S. Treasury Secretary Scott Bessent confirmed that the process to select Powell’s successor had already started.
Kevin Hassett, a White House adviser and leading candidate to replace Powell, has stated that the Federal Reserve has enough room to cut interest rates and would likely do so under his leadership.
The price of BTC moved from $118,400 to $120,000 following the report. Bitcoin currently trades at $118,731, according to CoinMarketCap, 1.64% higher on the day.
Price action has already been discounted by market experts due to investors’ expectations that liquidity will flood into the financial system in the case of rate reductions.
However, President Trump later denied that he intends to fire Powell; he said such a decision is “very unlikely unless there’s fraud.”
Despite the denial, Trump admitted to discussing the idea with Republican lawmakers. The price of Bitcoin briefly dipped back below $119,000 following the clarification.
The legal question of whether Trump can fire the Fed Chair is unresolved. A Supreme Court ruling in June found that the role does have some insulation from being unilaterally fired by the president.
Some have implied that Powell’s alleged profligacy on a renovation project could be turned into a political issue. William Pulte, Chairman of the Federal Housing Finance Agency, has also already asked for an investigation into the matter.
