The financial markets are experiencing turbulent times partly due to Donald Trump's influence. His strategy to reduce Fed interest rates is significantly impacting cryptocurrencies.
Trump and the Fed: A Clash of Interests
In February, Donald Trump publicly urged the Federal Reserve to lower interest rates, facing resistance from its chairman, Jerome Powell. According to analyst Anthony Pompliano, Trump's administration is deliberately causing a sharp decline in financial assets to pressure the Fed. The goals include decreasing rates to ease US debt burden, influencing monetary policy, creating an economic shock, and modifying market expectations.
Impact on Financial Markets
Market indices quickly reacted to the administration's actions, accompanied by a significant drop in bond yields. Alex Krüger supports this theory, noting that while the Fed is not planning immediate rate cuts, the market expects reductions by May.
Cryptos Under Pressure
The crypto market is also under pressure. On March 10, a steep drop in crypto markets accompanied stock market panic. JPMorgan raised the recession probability in 2025 to 40%. Some institutions are using this instability; for instance, BlackRock is expanding its DeFi activities through Securitize, and Cboe BZX is pushing for staking on Fidelity's Ethereum ETFs.
The situation in financial markets and cryptocurrencies remains unstable and is largely dependent on the Fed's decisions and the political scenario in the USA. The upcoming period will significantly influence the future of global economic regulation and the development of the crypto industry.
