President Donald Trump announced the firing of Fed Governor Lisa Cook on August 25, 2025, citing allegations of mortgage fraud.
Appointed by President Joe Biden in 2022, Cook was the first Black woman to serve on the Fed’s Board of Governors and was known for her dovish views on interest rates, often supporting policies that favored economic growth and low unemployment.
Trump, invoking “for cause” removal under the Federal Reserve Act, accused her of falsely claiming primary residences on mortgage documents for properties in Michigan and Georgia, a claim stemming from a Department of Justice investigation prompted by a Trump ally.
The letter, posted on Truth Social, has sparked intense debate over the Fed’s independence, with experts warning of potential legal challenges that could reach the Supreme Court.
Volatility from Trump’s Firing of Fed Governor Lisa Cook
The announcement triggered quick reactions in financial markets, including crypto, as investors grappled with uncertainty. Here’s a snapshot of the initial impacts:
- Price Declines: Bitcoin (BTC) fell around 3% to about $112,000, while Ethereum (ETH) dropped over 5% amid broader risk aversion. Altcoins like XRP saw potential short-term swings between $2.60 and $3.18.
- Increased Market Jitters: The U.S. dollar weakened by 0.3%, boosting gold prices but leading to “whale” sell-offs in crypto. Liquidations totaled millions, with the Fear and Greed Index hovering at a neutral 48.
- No Major Crypto-Specific Hit Yet: Analysts note limited direct effects so far, but the event amplified volatility in AI-related tokens and overall sentiment.
Long-Term Outlook Amid Trump’s Firing of Fed Governor Lisa Cook
Over time, this could benefit crypto if it leads to faster interest rate cuts, drawing liquidity into risk assets like digital currencies.
Reduced trust in traditional finance might position Bitcoin as a hedge, with some predicting surges for tokens like XRP if pro-crypto appointees emerge.
However, ongoing legal fights and fears of inflation could prolong uncertainty, keeping markets on edge.
As developments unfold, Trump’s firing of Fed Governor Lisa Cook underscores the fragile interplay between politics and economics.
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