Update (Aug. 26, 2025, 2 PM UTC): This article has been updated to add commentary by crypto lawyer Aaron Brogan.
US President Donald Trump announced the dismissal of Federal Reserve Governor Lisa Cook, raising questions about the reliability of the US dollar.
In a Tuesday post, the White House Rapid Response X profile published a letter signed by Trump removing Cook from her role at the Federal Reserve. He accused her of having made false statements on one or more mortgage agreements and, addressing her directly, wrote:
According to a Tuesday Associated Press report, Cook said she would not step down. She said Trump was attempting to remove her from her post “for cause,” but claimed that “no cause exists under the law,” and added that Trump “has no authority” to remove her. She concluded that she “will not resign.”
Crypto lawyer Aaron Brogan said that signing two inconsistent personal mortgage documents — which is what Cook is accused of — does not constitute a valid cause for firing. He explained that “cause generally means some misconduct, neglect of duty, dishonesty, or action that materially impairs the individual’s ability to perform their obligations.”
Brogan said that “it is certain that a court will grant” a preliminary injunction, which will prevent Cook from being removed from her position until the case concludes. He explained:
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The Fed’s independence is critical
The Federal Reserve has a significant degree of independence from the US government. Founder of Obchakevich Research, Alex Obchakevich, told Cointelegraph that the Fed’s independence “is the foundation for the stability of the US economy.” He explained:
Brogan similarly said that “if Fed independence is undermined, it will negatively affect US monetary policy and probably weaken the dollar further.” He explained why central bank independence is in place:
Obchakevich suggested that Trump decided to fire Cook for “political reasons” and that his decision undermined the Fed’s independence. This leads toward market uncertainty and worsens economic sentiment, he said, adding:
When asked whether Bitcoin (BTC) could be a potential solution, Obchakevich said that in the long term, “Bitcoin could weaken the dollar’s role as a reserve currency.” Still, he said Bitcoin did not appear to be a near-term solution.
Related: US Fed to end oversight program for banks’ crypto activities
Trump’s clashes with the Federal Reserve
The news followed repeated clashes between Trump and the Federal Reserve’s leadership. In mid-April, Trump bashed Federal Reserve Chair Jerome Powell for allegedly cutting interest rates too slowly amid a US-initiated trade war.
He then went so far as to suggest firing him. “Powell’s termination cannot come fast enough!” Trump said.
Market participants were quick to reject the idea. Famed crypto entrepreneur Anthony Pompliano said that Trump shouldn’t follow through on his threat to fire Powell.
“I do not believe that the president of the United States should come in and unilaterally fire the Fed” chair, he said. He suggested the action would set a bad precedent.
US Senator Elizabeth Warren also warned that if Trump fired Powell, it could undermine investor confidence in the integrity of US capital markets and trigger a financial crash.
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Source: https://cointelegraph.com/news/trump-fires-fed-governor-lisa-cook-dollar-bitcoin-market-uncertainty?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
