The Fed–Trump battle is rattling crypto markets: Bitcoin caught in the crossfire

For years, the crypto market followed a simple rule wherein lower interest rates usually push asset prices higher. But as 2026 begins, a major political clash is showing that liquidity alone isn’t enough.

Tensions between the Trump administration and Federal Reserve Chair Jerome Powell have grown into a serious institutional conflict.

This has put crypto in a rare push-and-pull situation.

Trump—Fed and the stuck crypto market

On one side, the administration’s strong pro-crypto stance and push for lower rates should, in theory, be bullish for Bitcoin [BTC] and digital assets.

On the other hand, the attack on the Federal Reserve’s independence has unsettled large institutional investors like BlackRock and Fidelity. 

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