Update as of 03/30 below. This article was initially published on March 29.
Bitcoin and cryptocurrency valuations have retreated as concerns over inflation persist, compounded by U.S. President Donald Trump’s tariff threats and emerging worries about a new, unidentified hacking incident.
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Currently, the price of bitcoin has retraced towards $80,000 after peaking near $90,000 earlier this week, despite the recent announcement of a significant milestone for bitcoin.
As bitcoin outpaces the performance of Tesla, renowned crypto trader Arthur Hayes has forecasted that the Federal Reserve will induce a surge in bitcoin prices come April.
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Federal Reserve chair Jerome Powell could soon trigger a significant shift in bitcoin prices and the broader crypto market … More
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“There has been a noticeable shift in the tone of [Federal Reserve chair Jerome Powell] during the last Fed board meeting,” Hayes, co-founder of crypto derivatives pioneer BitMex and founder of the Maelstrom investment company, shared during a discussion with podcaster Kyle Chasse.
Earlier this month, the Federal Open Market Committee (FOMC) decided to maintain current interest rates after initiating a rate-cutting strategy in September.
03/30 update: Federal Reserve chair Jerome Powell, who has had disagreements with President Donald Trump regarding the pace of rate cuts, may face dismissal from the president, according to a prominent Democratic senator.
“There are no guarantees, not even for the chairman of the Federal Reserve,” stated Massachusetts senator Elizabeth Warren in a Bloomberg interview. “If [Trump] can disregard every civil servant, if he can dismantle the Consumer Financial Protection Bureau, this constitutes a breakdown of law and order where all power is concentrated in the hands of one.”
Warren’s caution comes as Trump, supported by Tesla’s billionaire Elon Musk, who is spearheading the so-called Doge department of government efficiency, has made sweeping changes to federal agencies in the brief period since his return to the White House.
Powell, who was appointed by Trump during his first term, has indicated a preference for a cautious approach regarding interest rate decreases, as they remain high following the Covid-era stimulus and lockdowns that spurred inflation.
Conversely, Trump is advocating for immediate rate reductions, claiming that lower rates would bolster his international trade tariff strategy.
“The Federal Reserve would be in a much better position to reduce rates as U.S. tariffs begin to ease their impact on the economy,” Trump noted last week on his Truth Social account, urging Powell and the Fed to “act appropriately.”
The FOMC has revised its projections, lowering its expectations for economic growth and slightly increasing its inflation forecasts while continuing to pull back on its “quantitative tightening” program, which involves the gradual reduction of bond holdings on its balance sheet.
Hayes, who recently received a pardon alongside his fellow BitMex founders Benjamin Delo and Samuel Reed for violations of the Bank Secrecy Act from President Donald Trump, believes the Fed is hinting at a potential return to “stealth” money printing, also known as quantitative easing, amid a staggering $36 trillion U.S. debt that has escalated since 2020.
He pointed to Powell’s remarks at the latest Fed press conference that indicated “the inflationary impacts of tariffs are temporary.”
“Tariffs are no longer a concern for Powell, and they shouldn’t be a concern for crypto investors either,” Hayes stated. “Whether Trump implements a 50% tariff or just 2%, it doesn’t matter, because we can expect Powell to continue fostering the economic conditions necessary for our portfolios to grow in fiat terms.”
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Bitcoin’s price has soared over recent years, with an anticipated Federal Reserve shift expected to fuel further … More
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Trump’s latest tariffs, which have unsettled bitcoin, cryptocurrency, and stock markets, are scheduled to take effect on April 2, impacting goods from Canada, Mexico, and China.
Simultaneously, bitcoin might be poised for a rally toward $90,000, as predicted by 10x Research founder Markus Thielen, who believes a combination of Trump’s easing on tariffs and a progressively dovish Federal Reserve is setting the stage for bitcoin’s comeback.
“Bitcoin is attempting to stabilize, benefitting from Trump’s recent shift toward ‘flexibility’ regarding the forthcoming April 2 tariffs,” Thielen noted in an email update.
Thielen also referenced Fed chair Powell’s indication that the Fed would “overlook short-term inflationary pressures, paving the way for potential future easing.”
“Powell’s somewhat dovish stance implies that the Fed’s cushion remains intact, providing additional support for a rebound in stock valuations.”
