White House Intensifies Push for Fed Shakeup as Crypto Surges

The White House is ramping up its efforts to overhaul the leadership of the Federal Reserve, adding fresh volatility to markets over the weekend.

As speculation swirled about possible changes at the Fed, bitcoin (BTC) soared above $120,000 for the first time ever. While the correlation might not be direct, crypto markets often thrive on expectations of looser monetary policy—and a leadership shakeup could be exactly that catalyst.

Pressure Mounts on Powell

Current Fed Chair Jerome Powell has been under mounting political pressure. After slashing rates by 75 basis points before the 2024 election, Powell pivoted to a more hawkish stance following Donald Trump’s victory—a shift that reportedly frustrated the new president. Although Powell allowed one additional 25 basis point cut shortly after November, tensions have persisted.

“Frankly, it’s about breaking some heads,” said former Fed Governor Kevin Warsh on Fox News Sunday. Warsh, frequently mentioned as a top contender to replace Powell, criticized the Fed’s controversial $2.5 billion renovation project, calling it evidence that the institution has “lost its way.” He declared it was time for “regime change” at the central bank.

Kevin Hassett, Director of the National Economic Council and another possible Powell successor, appeared on television Sunday as well. He confirmed the administration is exploring whether the president has the legal authority to fire Powell, stating, “Certainly if there’s cause, he does.”

Renovation Controversy

The Fed’s costly renovation project has become the latest flashpoint in the debate over Powell’s future. Critics question both the scale of the expenditure and whether Powell provided accurate testimony to Congress about the plan. Last week, Office of Management and Budget Director Russ Vought formally sent Powell a list of questions demanding more details.

In response, the Federal Reserve published a new FAQ page over the weekend to defend its side of the story.

Trump Keeps Up Pressure

President Trump himself didn’t hold back over the weekend. “It would be a great thing for the country if Powell left,” he declared, accusing the Fed chair of keeping interest rates unnecessarily high.

“Jerome Powell has been very bad for our country,” Trump said. “We should have the lowest interest rate on Earth, and we don’t. He just refuses to do it.”

He also criticized the renovation project, linking it to cost overruns and reminding Americans that it was approved under President Joe Biden.

Potential Crypto Impact

Beyond monetary policy, crypto markets are eyeing leadership changes at the Fed for potential regulatory shifts as well.

While Powell has mostly remained neutral on crypto publicly, he’s consistently described bitcoin as more akin to gold than to a practical alternative to the U.S. dollar, given its role as an investment asset rather than a payment method. He has also repeatedly called for tighter regulation around stablecoins, citing financial stability risks, and has emphasized the need for consumer protections and scrutiny of “debanking” practices targeting crypto firms.

A new Fed chair could usher in policies perceived as friendlier—or at least different—toward the crypto industry, adding another layer of intrigue to an already volatile market backdrop.