Bitcoin Briefly Falls Below $76,000: Will Powell Staying on Board Curb Rally?

TradingKey - Fed maintains interest rates, Bitcoin price falls below $76,000 as Powell's stay may hinder rebound.

On April 30 (GMT+8), Bitcoin ( BTC) narrowed its losses and returned above $76,000, currently trading at $76,226. Last night, the Fed again announced it would maintain interest rates in the 3.5%-3.75% range, and Bitcoin's price dropped by more than $2,000, briefly touching $75,000.

Bitcoin price chart, source: CoinMarketCap

Although the Fed's decision not to cut rates was largely in line with market expectations, Fed Chair Jerome Powell's remarks were unexpected, with his decision to continue as a Fed Governor being the most noteworthy. Powell stated, "I am standing my ground and will not leave until the Department of Justice investigation is fully concluded. I will continue to serve as a Governor after May 15 and will leave the Fed at the appropriate time."

After the announcement of Powell's stay, the Trump administration quickly criticized the move. U.S. President Trump posted a response saying, "[Powell] wants to stay at the Fed because he can't find a job elsewhere—no one wants him." U.S. Treasury Secretary Bessent accused Powell of breaking tradition, stating, "It would be extraordinary for outgoing Fed Chair Powell to remain as a Fed Governor. For someone who has always emphasized norms, his unilateral decision runs counter to tradition."

Powell has always seen "fighting inflation" as the ultimate legacy of his career, which means that as long as he remains at the Fed, it will be difficult to cut rates and provide a massive "liquidity injection" to the market. This undoubtedly places a significant constraint on Bitcoin, which is driven by liquidity. Furthermore, as a defender of the traditional financial system, Powell remaining on the Board means the Fed is highly likely to continue pushing for stricter stablecoin regulation and limits on bank involvement in cryptocurrencies.

However, Powell explicitly refused to act as a "shadow chair" to undermine Kevin Warsh's authority, a move that undoubtedly provided some relief to anxious market sentiment as it reduced obstacles to Warsh's takeover. It is reported that Warsh currently has 13-11 support in the Senate Banking Committee, with the full Senate vote to follow.

Notably, the Senate is currently Republican-led, which makes Warsh's confirmation highly likely; the vote is expected during the week of May 11. Once confirmed, Warsh will be sworn in on May 15, which may trigger significant volatility in the crypto market. Whether it rises or falls will depend on the extent of Powell's intervention in the Fed and Warsh's actual actions.