Could Bitcoin Benefit From Trump Powell’s Firing? Turkish Lira Crisis May Provide Clues
By Omkar Godbole Updated April 22, 2025 3:08 AM Published April 21, 2025 8:35 PM
The week started off with interesting developments: the US dollar fell to a three-year low, Wall Street saw losses, but Bitcoin (BTC), which usually follows Wall Street sentiment, remained stable.
At the time of writing, Bitcoin was trading at around $87,000, up 2% on the day.
This may just be the beginning of Bitcoin’s transformation into a safe haven asset.
The shift away from the US dollar to seizure- and censorship-resistant assets such as BTC and stablecoins could accelerate if President Donald Trump follows through with his plans to fire Federal Reserve Chairman Jerome Powell, which sent the DXY and US stock markets lower today.
That’s the lesson from Turkey, whose currency, the lira (TRY), has been depreciating for years, largely due to President Recep Tayyip Erdogan’s repeated interventions in the central bank. The lira’s decline has triggered capital flight into BTC and stablecoins since at least 2020-21.
Trump has been at odds with the Federal Reserve and its chairman, Jaron Powell, for years, criticizing Powell for moving too late to cut rates even during his first term as president, when interest rates were much lower than they are now.
But Trump’s criticism has reached a fever pitch recently, with speculation that he is seeking to get rid of Powell, who recently warned of stagflation, even as the president has repeatedly called for lower borrowing costs while simultaneously claiming there is no inflation.
Powell’s moderate approach comes as the trade war has driven a sharp rise in inflation expectations that could become self-fulfilling.
But Trump went further on Monday, calling Powell a “major loser” and warning that the economy could slow unless interest rates are cut immediately.
Erdogan began interfering with the central bank in 2019, and since then the lira has depreciated sevenfold, from 5.3 per dollar to 38 per dollar.
It all started when Turkey’s inflation rate reached double digits in 2017. It remained high in the following year, prompting the country’s central bank to raise its one-week repo rate from 17.5% to 24% in September 2018.
The move likely did not please Erdogan, who issued the first decree dismissing Central Bank of Turkey (CBT) Governor Murat Cetinkaya in July.
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