Trump-Powell Tensions Spark Market Uncertainty
Bitcoin remained stable near the $85,000 mark late Thursday, as investors digested mounting macroeconomic headwinds and a growing rift between U.S. President Donald Trump and Federal Reserve Chair Jerome Powell. While digital assets showed resilience, traditional markets struggled to find direction in the face of policy uncertainty and weakening economic indicators.
The CoinDesk 20 Index saw broad gains, with Bitcoin Cash (BCH), NEAR Protocol (NEAR), and AAVE leading the charge. Ethereum (ETH) also advanced modestly alongside Bitcoin, which posted a 0.8% gain over the past 24 hours.
Tensions between the White House and the Federal Reserve flared up again this week, with reports surfacing that President Trump has privately explored options to remove Powell from his post — a move that would raise red flags over the central bank’s independence. Although Powell’s term runs through May 2026, speculation over a potential shakeup has begun to ripple through financial markets.
According to sources cited in multiple reports, former Fed Governor Kevin Warsh is being considered as a possible successor, though he has reportedly advised caution against taking action that could further destabilize markets. Treasury Secretary Scott Bessent echoed that sentiment, warning that interference with the Fed’s leadership could undermine investor confidence at a delicate time.
The political drama is unfolding against the backdrop of weakening economic data. The Philadelphia Fed’s latest manufacturing index posted a sharp decline to -26.4, the lowest reading in two years. Simultaneously, the prices paid index surged to its highest level since mid-2022, stoking fears of stagflation — the toxic combination of rising inflation and slowing growth — especially as the Trump administration continues to push aggressive tariff measures.
Bitcoin Options Signal Split Sentiment
Traders in the crypto derivatives market appear split, expressing both bullish optimism and caution. Data from options exchange Deribit shows strong interest in Bitcoin call options with strike prices between $90,000 and $100,000 expiring in May and June — a signal that some investors anticipate continued upward momentum.
To finance these positions, some traders have sold put options, collecting premiums while betting that Bitcoin will remain above certain levels. At the same time, there’s been a noticeable uptick in demand for protective puts around the $80,000 level, indicating hedging activity against potential short-term downside.
This two-way flow in options markets comes amid elevated readings in the CBOE Volatility Index (VIX), often dubbed Wall Street’s “fear gauge.” Although the index has pulled back from recent highs, it remains well above its 50-day average, signaling persistent investor anxiety.
Adding to the global uncertainty, the European Central Bank on Thursday cut interest rates for the seventh consecutive time, citing worsening economic prospects in the eurozone.
With central banks walking a tightrope between inflation control and growth support, and political risk rising at home, Bitcoin’s relative stability in the $83K–$86K range reflects both cautious optimism and the digital asset’s emerging role as a macro hedge.