Trump Adviser Calls for Powell Exit as Bitcoin Watches Fed’s Next Move

President Donald Trump’s top economic adviser, Kevin Hassett, is urging former Federal Reserve Chair Jerome Powell to resign from the Fed’s Board of Governors. This could have implications for U.S. monetary policy and Bitcoin.

Hassett suggested Powell “move on” following an internal oversight report of problems with Fed management of renovations at the central bank’s Washington, D.C., office. Trump also expressed support for forcing Powell to resign from the Fed board and other hostility toward the former chair.

Powell has been working at the Federal Reserve since May, when Chairman Kevin Warsh was appointed. Powell is important because he continues to serve as one of 12 voting members of the Federal Open Market Committee and has a vote on interest rate policy.

Powell Exit Could Reshape Fed Rate Expectations

If Powell resigns before the end of his term as governor, Trump can appoint a replacement governor, pending Senate approval. That wouldn’t necessarily be positive for Bitcoin if Powell resigned, though. It would depend on the replacement’s views on policy issues, including interest rates.

The discussion comes after the Federal Reserve raised its target rate 25 basis points to 3.75%-4% on Sept. 16. All Federal Reserve policymakers voted to increase the target rate. This is the first rate hike since 2023. Inflation is still higher than the Federal Reserve’s 2% target. Other economic factors and data are considered in decisions about interest rates and inflation.

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Bitcoin rebounded after poor performance surrounding the September meeting. Bitcoin price rose above $87,000 after increased corporate and other institutional interest in US spot Bitcoin ETFs helped drive demand. Institutional interest may help counteract some of the effects of tighter monetary policy.

Could Lower Rates Give Bitcoin a Tailwind?

A dovish Federal Reserve may benefit Bitcoin prices if lower interest rate expectations lead to lower Treasury yields and better market liquidity. However, Powell’s departure alone is unlikely to make this scenario more likely.

Treasury yields are a key factor for Bitcoin. High Treasury yields can act as a headwind on financial conditions and provide alternative yields to investors who are wary of Bitcoin’s price fluctuations. 

Factors affecting Bitcoin’s price include Fed expectations and movements in Treasury yields and other investment products such as ETFs and institutional interest in Bitcoin.

Powell’s role is significant largely because a new governor on the FOMC might change the mix of policy views on the committee. The Federal Reserve website shows Powell, along with other governors and regional Fed leaders, as a 2026 voting member of the FOMC.

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The next key event is the Federal Reserve meeting on Oct. 27-28, at which interest rate expectations are likely to be a major focus. Markets are reevaluating expectations for further interest rate increases, and Bitcoin traders are paying close attention to economic news and other developments involving policymakers.

A Powell exit might introduce additional factors affecting digital asset markets, though Powell’s exit is unlikely to have a large impact on BTC prices depending on who succeeds him and other effects on expectations for future U.S. interest rates.

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