Jerome Powell's Influence on Crypto Markets and Fed Policy Through 2025
Jerome Powell’s decisions as Federal Reserve chair have significantly impacted bitcoin and cryptocurrency markets. Powell was originally nominated by President Trump in 2018 and re-nominated for a second term by President Biden in 2022. His current term extends through May 2026, having served across the Trump I, Biden, and Trump II administrations.
The pandemic era saw liquidity injections that fueled massive rallies across various assets, including cryptocurrencies. However, inflation remained persistent following this period and, by late 2025, inflation remained above the Fed’s 2% target. The December 9-10 Federal Open Market Committee meeting was notably contentious. The Fed decided to trim interest rates by 25 basis points, with three dissenting votes: two members voted to hold rates steady, and one member favored a larger 50 basis point cut.
Monetary policy shifts under Powell have closely correlated with crypto market movements. Lax monetary policies and rate cuts tend to boost crypto prices, while tightening leads to declines. For example, bitcoin’s price surged from around $3,000 in 2020 to approximately $65,000 within 13 months, before falling to about $15,000 in 2022 amid a series of rate hikes. It later approached nearly $125,000 in 2025, aided by two rate cuts earlier that year. Following the October 28-29 meeting, bitcoin’s price drifted lower in anticipation of limited easing measures expected in January 2026.
Looking ahead, Powell’s term is set to end in May 2026. Reports indicate that former President Trump is unlikely to renominate him. Leaks suggest a potential successor may be named before the end of 2025, creating a "shadow Fed chair" dynamic during Powell’s remaining tenure. Despite this, Powell could remain on the Federal Reserve Board through 2028.
