High-Stakes Week for Crypto: Powell’s Testimony and Its Implications

As the year kicked off, cryptocurrency markets witnessed a promising phase after bouncing back from a rocky three-month period. However, this optimism was hindered in the final quarter, with Bitcoin (BTC) experiencing a significant drop of $10,000 upon testing its resistance. The recent resurgence of the Greenland debate, intensified by Trump’s remarks, contributed to notable sell-offs this week, following a caution issued earlier.

What Awaits Cryptocurrencies in the Near Future?

This afternoon at 18:00, a crucial testimony by Powell at a Supreme Court hearing involving Cook is expected. Trump’s previous threats against Powell over interest rate cuts add weight to today’s proceedings. If Powell’s comments raise doubts about the Federal Reserve’s independence, it could trigger adverse reactions in the risk market.

Despite a prior attempt to unseat Cook, the courts permitted him to remain in his role until legal proceedings reached a conclusion. Following appeals, the case has now reached the Supreme Court, drawing significant attention and speculation.

Could Powell’s Testimony Bring Turbulence?

Powell’s potential comments on facing pressure, much like Cook, could prove challenging for the crypto sphere. An unfavorable court ruling for Trump may solidify the Fed’s autonomy, potentially leading to modest rate cuts. However, a ruling favoring Trump could weaken the Fed’s independence, risking upheaval among hawkish members.

Treasury bonds are slowly recovering from a European pension fund-led sell-off, precipitated by Japanese bond sell-offs. This has fueled concerns of broader economic disturbances, particularly as Trump’s market-oriented policies clash with tariff concerns and the Greenland controversy.

Today, Trump is also slated to meet EU leaders, followed by discussions with U.S. business leaders to secure further investments. Although a Customs Tariff decision announcement is unexpected, a slight chance exists post-meetings, with a formal announcement anticipated on February 20th. Meanwhile, Bitcoin remains at $88,000.

“The intricacies of the market and unexpected global events can often derail even the most anticipated progress,” stated an insider familiar with the situation.