The week has begun on an attention-grabbing be aware, with the U.S. greenback crashing to three-year lows alongside losses on Wall Road, but bitcoin, which normally follows the sentiment on Wall Road, stands tall.
[PLEASE CAN HAVE A PRICE HERE AND A QUANTIIFICATION – THE BTC PRICE ISN’T THAT TALL]
This might simply be the start. [BEGINNING OF WHAT]
The shift away from the USD and towards seizure and censorship-resistant belongings like BTC and stablecoins might speed up if President Donald Trump follows by means of along with his reported plans to fireplace Federal Reserve Chairman Jerome Powell, which have pushed the DXY and U.S. inventory markets decrease in the present day.
That is the lesson from Turkey, which has seen its forex, the lira (TRY), collapse through the years primarily attributable to President Recep Tayyip Erdogan’s repeated interference within the central financial institution’s operations. The sliding lira has triggered a capital flight into BTC and stablecoins since at the least 2020-21.
Trump’s points with the Fed
Trump has feuded publicly with the Federal Reserve and its chairman, Jerome Powell, for years, criticizing Powell for being too late on price cuts even throughout his first time period when rates of interest have been manner decrease than in the present day.
Nevertheless, Trump’s criticism has lately reached a fever pitch with experiences suggesting he’s searching for methods to do away with Powell, who lately warned of stagflation even because the President reiterated requires decrease borrowing prices whereas suggesting there is no such thing as a inflation.
Powell’s affected person method follows a commerce war-led spike in survey-based measures of inflation expectations, which might all the time grow to be self-fulfilling.
Nonetheless, on Monday, Trump went additional, calling Powell a “main loser” and warning that the financial system might decelerate until rates of interest are instantly lowered.
Lesson From Turkey
Erdogan started interfering within the central financial institution’s operations in 2019, and since then, the lira has collapsed sevenfold from 5.3 per greenback to 38 per greenback.
It began with Turkey’s inflation price reaching double digits in 2017. It remained elevated within the subsequent yr, which prompted the nation’s central financial institution to extend the one-week repo price from 17.5% to 24% in September 2018.
The transfer probably did not go properly with Erodgan, who issued the primary decree dismissing Central Financial institution of Turkey (CBT) governor Murat Cetinkaya in July 2019. From then on till the tip of 2021, Erdogan issued a number of decrees dismissing and hiring a number of CBT officers. Amid all this, inflation remained elevated, and the lira continued to depreciate at an alarming price.
“We definitely don’t imagine in excessive rates of interest. We’ll pull down inflation and change charges with low-rate coverage … Excessive charges make the wealthy richer, the poor poorer. We received’t let that occur,” Erdogan mentioned in 2021.
As of 2025, Turkey faces an inflation price of almost 40%, based on information supply TradingEconomics.
This episode serves as a cautionary story for Trump, highlighting that tampering with central financial institution independence — particularly within the face of looming inflation — can erode investor confidence and ship the home forex right into a tailspin.
This doesn’t essentially imply that the USD will crash precisely like lira however might even see important devaluation.
Maybe it might show much more destabilizing for world markets, contemplating the greenback is a worldwide reserve forex, and the U.S. Treasury market is the bedrock for worldwide finance.
If higher sense fails to prevail, U.S. buyers could really feel incentivized to maneuver away from U.S. belongings and into BTC and different different investments, simply as Turks did.
