Bitcoin and cryptocurrency prices have experienced a notable upswing as 2026 dawns, with Bitcoin nearing the significant threshold of $100,000. This increase of 10% from its lows in December comes amid heightened speculation regarding the future of U.S. monetary policy. Meanwhile, Bank of America’s CEO has issued a stark $6 trillion warning on the crypto landscape, signaling potential risks ahead.
Despite the recent rally, Bitcoin’s current price remains significantly lower than its peak of $126,000 recorded in October. The market’s optimism is fueled by expectations of a more dovish approach from the Federal Reserve, which traders believe could be triggered by a shift in leadership at the Fed. Goldman Sachs has suggested that a key catalyst may be on the horizon that could further ignite the market.
Complicating this scenario, U.S. President Donald Trump has cast doubt on the anticipated nomination of Kevin Hassett, a prominent economic advisor, for the role of Federal Reserve chair. Hassett, widely viewed as a more dovish candidate, was seen as a potential supporter of the cryptocurrency market. Trump’s recent remarks indicate hesitance about moving Hassett from his current position, which could have significant implications for the Bitcoin price rally.
At a recent White House event, Trump acknowledged the potential risks of losing a valuable team member like Hassett, emphasizing his desire to retain him in his current role. This statement sent the odds of Hassett being named Fed chair tumbling on Polymarket, subsequently elevating Kevin Warsh’s chances of becoming the front-runner for the position. Warsh, a former Fed governor with investments in cryptocurrency companies, is perceived as less dovish than Hassett, suggesting a more stringent approach to interest rates should he be selected.
The implications of Trump’s decision are substantial, as expectations build around the possibility of lower interest rates in 2026 once he replaces Jerome Powell as Fed chair. This scenario has contributed to bullish sentiment in Bitcoin and equity markets over the past months.
Aurelie Barthere, a principal research analyst at Nansen, noted that a nomination of Hassett would have typically been deemed more favorable for the cryptocurrency market, as he would likely take a more dovish stance than Warsh. Trump had previously expressed his inclination to appoint either Hassett or Warsh, highlighting the competitive dynamics surrounding the Fed chair position. In his remarks, Trump indicated that an announcement would come in the next few weeks, further adding to the market’s anticipation and speculation about the future of monetary policy and its potential impact on Bitcoin and the broader crypto market.
