Trump Issues Huge Fed Challenge—Sparking Stock Market Plunge As Gold And Bitcoin Price Soar

Bitcoin and crypto prices are treading water after U.S. president Donald Trump’s trade war sparked market chaos that’s threatening to spiral into a full-blown “U.S. dollar confidence crisis.”

The bitcoin price has plummeted from its January peak of almost $110,000 per bitcoin, dropping along with the stock market, as crypto hurtles toward a $19 trillion “tipping point.”

Now, as billionaire Ray Dalio warns the U.S. is teetering on the verge of a financial crisis and recession that could be worse than 2008, the White House has confirmed Trump is exploring whether he can fire Federal Reserve chair Jerome Powell—something that could trigger an “apocalyptic scenario" for markets.

This week, Trump posted to his Truth Social account that “Powell’s termination cannot come fast enough” after Powell reiterated his intention to keep interest rates on hold due to uncertainty over Trump’s tariff trade war.

Last month, influential Democratic Party senator Elizabeth Warren said Trump could try to fire Powell, ominously warning, “nobody is safe.”

“It would be a huge, huge shock,” Bilal Hafeez, chief executive of investment research company Macro Hive, told The Telegraph newspaper. “Overall, it would almost be like an apocalyptic scenario for the market.”

The bitcoin price has shot higher after U.S. president Donald Trump doubled down on his calls for immediate, “preemptive” interest rate cuts, suggesting Federal Reserve chair Jerome Powell surprised markets with September’s rate cut in order to help the Democratic Party in November’s election.

“’Preemptive cuts’ in interest rates are being called for by many,” Trump posted to his Truth Social account.

The bitcoin price has climbed to over $88,000 per bitcoin, up from April lows of under $75,000.

“With energy costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other ‘things’ trending down, there is virtually no inflation," Trump wrote.

"With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a slowing of the economy unless Mr. Too Late, a major loser, lowers interest rates, now,” Trump wrote, adding Europe has “already ’lowered’ seven times.”

Stock markets have opened lower on Wall Street, led by Nasdaq and tech company declines, while the U.S. dollar has hit fresh multi-year lows against other major currencies.

The gold price has surged to over $3,400 a troy ounce, a new record, as traders cash out of equity and into the traditional safe haven.

“Bitcoin and gold are surging in tandem this morning as the market digests yet another shock move from the U.S. president Donald Trump—this time, an apparent outright threat to fire Federal Reserve chair Jerome Powell,” Nic Puckrin, crypto analyst and founder of The Coin Bureau, said in emailed comments.

“This has caused the U.S. dollar to plummet to a three-year low, but both gold and bitcoin are emerging as safe havens.”

Trump’s barrage of global trade tariffs have blown up the established order of international trade, fuelling market uncertainty and driving investors out of risk assets such as bitcoin and crypto.