The Federal Reserve just announced a 25 basis point rate cut, but the market's reaction was surprisingly dramatic. The dot plot indicates that there may only be one more rate cut before 2026, and U.S. Treasury yields immediately surged past 4.2%. This should have been a dovish decision, but the market was frightened even more.

Trump stepped in at this moment, directly criticizing Powell's policies for dragging down economic growth. He even brought up old issues, angrily condemning the $2.5 billion overspend on the Fed building renovation. More importantly, he signaled that if rates are not cut significantly, there will be no room for negotiation on nominating a new chair in 2025.

Powell has five months left in his term. On the surface, he maintains the restraint expected of a central bank, but under political pressure and market panic, the "independence of the Federal Reserve," a cornerstone of the financial system, has begun to waver. Strategists are warning wildly: once central bank decisions become political tools, long-term U.S. Treasury yields could spiral out of control, inflation expectations could heat up, and combined with risk premiums, yields of 4.5% or even higher are possible.

The current situation is quite ironic—rate cut expectations have essentially vanished, yet political theatrics are intensifying. The bond market continues to fluctuate at high levels, barely sustained by every remark from Trump. Traders are betting that by the time Powell leaves office in May 2026, the market will either celebrate or crash. This uncertainty is directly affecting the cryptocurrency market, with assets like BTC and ETH closely watching this tug-of-war over the Fed's independence.