The news and what it reveals
On a cold January morning, the guardians of America’s money were thrust into the heart of a political crossfire. Federal prosecutors, under President Donald Trump’s direction, opened a criminal investigation into Jerome Powell, the Federal Reserve chair, examining whether he misled Congress about the renovation of the central bank’s Washington headquarters. The inquiry, approved by Jeanine Pirro, a political ally of President Trump, is not merely a matter of building budgets. It is a dramatic escalation in an ongoing campaign against the Fed chair, raising questions about whether the world’s most powerful central bank can operate without fear or favor.
Investors reacted swiftly. In early trading on Monday, U.S. stocks wavered, the dollar weakened, and gold surged to record highs, signaling that the markets see this confrontation as more than a legal matter, but rather as an assault on the norms that underpin confidence in American money.
Wall Street’s “fear gauge,” the VIX, jumped, while safe‑haven metals rallied. In a video statement, Powell described the investigation as “unprecedented” and linked it explicitly to the Fed’s refusal to subordinate monetary policy to presidential preferences.
He warned that the threat of criminal charges is a consequence of the Fed setting interest rates based on evidence rather than political demands. This is a news story, but it also serves as a warning sign. A monetary system designed to appear independent is now being shaken by political subpoenas, and markets are treating that politicization as a signal of systemic fragility.
Politicized money always drifts toward dysfunction
America’s central bank was designed to operate outside partisan cycles, but “independence” is not a force field. In practice, the Federal Reserve has long been a political institution wrapped in technocratic language. Its mandate, set by Congress, tells a small committee to manage the price of credit for hundreds of millions of people. Even in calm times, the Fed’s rate‑setting authority distorts price discovery. Instead of allowing interest rates to emerge from the interplay of saver and borrower, a handful of governors signal to markets what they believe is appropriate. When political leaders begin to see that lever as a tool of electoral strategy, the distortion compounds. Last year, President Trump publicly lambasted Powell for not cutting rates fast enough. Now the Justice Department is threatening him with criminal charges in a renovation probe. When executive power and monetary authority collide, the system drifts toward the familiar issues of planned economies: price signals lose credibility, capital misallocation becomes endemic, and social trust erodes.
The consequences are already visible in the market’s response. After news of the investigation broke, investors briefly revived the “Sell America” trade, unloading U.S. stock futures, bonds, and the dollar. The benchmark 10‑year Treasury yield climbed toward a one‑month high, suggesting that borrowing costs could rise despite presidential pressure for cheaper credit. Gold and silver, neither of which relies on the reputation of a government, hit new records. These moves were simple, but they underscore a long-held fact: markets price political risk. When investors doubt that consistent rules guide monetary policy, they demand a risk premium because when money becomes a political instrument, it ceases to provide the signal that capitalism requires.
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Why ‘Fed Independence’ is not a force field
Defenders of the status quo argue that the Federal Reserve is insulated from politics, citing statutory language that grants governors fixed terms and prohibits presidential removal without cause. But legal language does not remove incentives. Powell’s term as chair ends in May, and the president has already decided on a replacement. The ongoing investigation into him sends a message to those who follow: defy the White House at your own peril. In the same statement where Powell condemned the subpoenas, he reminded the public that the Fed sets rates based on evidence and economic conditions. That reminder is not essential if the norm of independence were secure.
Congress wrote the Federal Reserve Act to free the central bank from direct meddling. Yet lawmakers and presidents routinely jawbone the Fed, and the central bank obliges by treating asset‑price stability as part of its unofficial mandate. The result is a blurred line between monetary policy and political survival. Senators from both parties condemned the new investigation: Republican Thom Tillis said it proves advisers within the administration are pushing to end the Fed’s independence, while Democrat Elizabeth Warren accused the president of seeking a “sock puppet” Fed chair.
Their outrage underscores the obvious: independence is a norm, not an immutable law. Norms hold until they don’t. Once it becomes acceptable to subpoena a central bank chair, independence can be eroded by intimidation, even if the law remains the same on paper.
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Depoliticized money, defined for normal people
So what does it mean to politicize money? Politicization occurs when discretionary power over the money supply and the cost of credit is concentrated in a small group of officials who respond to political incentives. Levers such as interest-rate targets, quantitative easing, regulatory guidance, and communication strategies become tools of narrative management. When politicians and central bankers determine that unemployment is too high or inflation is too low, they adjust these levers, injecting or withdrawing liquidity to achieve short-term goals. Political pressure can also take the form of public threats and private cajoling, as the current investigation shows. Narrative management completes the loop: the Fed uses press conferences and speeches to shape expectations, effectively guiding markets with rhetoric as much as with action.
Depoliticized money flips this model. A depoliticized monetary base has four qualities:
- Rules‑based supply. The growth of the monetary base is fixed by transparent protocol rather than by committee deliberation.
- Auditable issuance. Anyone can verify the number of units and how they are created.
- Predictable settlement. Transactions are clear according to objective rules, without discretion or selective enforcement.
- Market‑based rates. Interest rates emerge from the interaction of savers and borrowers, not from the policy preferences of officials.
Leaning on this structure would return the U.S. and the world to the idea that money is a commodity service rather than a policy instrument. In such a system, there is no “lever” for presidents to pull; there is only a protocol that participants must follow because true independence is not a promise; it is structural.
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The Bitcoin standard
If properly understood, Bitcoin is not a speculative token or a political movement. It is a protocol for issuing and settling digital cash. Designed as a computational commodity, it utilizes a proof-of-work mechanism to create new units according to an algorithmic schedule and competitive race conditions to secure the ledger. Every transaction is recorded in a public history that anyone can audit, and no central authority can change the rules because of public auditability. Supply growth halves periodically, and the end state is a fixed monetary base. When one speaks of a Bitcoin standard, one is referring to the use of this protocol as an underlying reserve asset and settlement layer for broader economic activity.
Crucially, the Bitcoin standard is not about ideology, but about constraints on the protocol and the abundance of usefulness at the network layer. With Bitcoin, there is no hidden committee adjusting interest rates, and no president can subpoena a miner for maintaining the truth. Issuance is algorithmic. Settlement is computational. Auditing is trivial because every node enforces the rules with proof-of-work. For savers and lenders, this means they can price risk based on the time value of money rather than on the expected next speech from a central banker.
Small blockers will say that holding BTC fixes these problems, but that is a massive psyop.
In reality, we need a scalable and useful network to actually solve these incentive problems, and Powell’s video reminder that the Fed sets rates based on evidence underscores how precarious that system is. With Bitcoin, there is no need for assurances because the rules are built into the code and enforced by people enforcing the rules.
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Restore usable money without central planning
A common objection to the Bitcoin standard is that economies require flexible credit and stable pricing, not just a hard base layer. That is true, and it’s why BTC (especially the stuff in custody at Strategy and BlackRock) doesn’t solve these problems. In reality, a modern financial system can thrive on top of a depoliticized base. Consider three pillars:
- Tokenized real‑world assets. Digital tokens can represent claims on precious metals, real estate, or corporate equity. Gold tokenization, for example, allows investors to hold an audited, redeemable claim on metal stored in vaults, with on‑chain proof of reserve. When these tokens circulate on a Bitcoin base layer, settlement is final, and audit trails are public. Precious metals are only the beginning. Supply chains, art, and even debt instruments can be tokenized, providing transparency and liquidity without requiring trust in a central administrator.
- Stablecoins like MNEE. Day‑to‑day commerce benefits from units of account that are stable relative to consumer goods. Fully backed stablecoins can provide that stability without ceding control of the monetary base. MNEE, for example, is a regulated stablecoin that maintains verifiable reserves and uses smart contracts to issue and redeem tokens. On a depoliticized base layer, stablecoins can function as transaction money while users retain the option to settle in the underlying Bitcoin.
- On‑network decentralized exchanges (DEX). A DEX built into the base layer allows token holders to trade assets and stablecoins based on supply and demand. Exchange rates and credit conditions emerge from real flows and risk appetites rather than from central bank pronouncements. Lenders can extend credit using smart contracts that require collateral and set interest rates algorithmically, and borrowers pay rates that reflect market conditions. When capital is priced by participants bearing real risk, interest rates become signals again. There is no lever for a president or a central banker to bully; there is only a market making decisions based on opportunity cost.
Under this architecture, credit expands and contracts according to participants’ confidence and liquidity, rather than according to the political calendar. Price discovery occurs in the open, with verifiable collateral. A Bitcoin in the base layer provides the constraints; tokenized assets and stablecoins provide flexibility; and on‑chain markets provide liquidity.
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Why BSV is the only scalable base for this architecture
Not all Bitcoin implementations are equal. After the historical splits of the Bitcoin network, different chains adopted divergent philosophies. BTC embraced high fees and limited block sizes, turning the network into a store‑of‑value asset with constrained throughput, which is why it’s primarily held in custody. That design cannot support tokenized real-world assets, high-frequency commerce, or on-chain DEX functionality at any appreciable scale. Other chains chase throughput but sacrifice the properties that make Bitcoin secure: they introduce new centralization risks or rely on inflationary token economics.
BSV is the only chain that retains the original protocol while scaling for real economic activity. BSV maintains low transaction fees and allows block sizes to grow organically, enabling thousands (or millions) of transactions per second at negligible cost. This throughput is essential for an economy in which every invoice, ticket, attestation, and micropayment settles on the chain. BSV also preserves script flexibility and on-chain data storage, allowing smart contracts and token protocols to run natively without sacrificing determinism. This means that tokenized assets, stablecoins, and DEX markets can operate at scale without moving settlement off the blockchain, where they can be molested.
Importantly, BSV adheres to the incentive structure that underpins Bitcoin’s security. Proof‑of‑work miners are rewarded for honest block production, and the fixed supply schedule remains intact. There is no inflationary funding of developers, nor is there a foundation choosing winners and losers. Low fees and high throughput are engineering prerequisites for building a depoliticized monetary system. Without them, network congestion and high transaction costs reintroduce bottlenecks that invite centralization. Only BSV meets all three requirements: scale, stability, and data utility.
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The fear test and the integrity test
Imagine you are a small business owner planning next year’s capital expenditures. Your borrowing costs will depend not only on your creditworthiness but on whether the president decides to attack or praise the Fed chair. The more political the conversation around money becomes, the more volatile your cost of capital. Savings that you set aside for your children’s education are likewise hostage to narrative cycles. Will a late‑night social media post from the White House send Treasury yields higher and erode the value of your bond portfolio? Or will a subpoena against a central banker spur a “debasement trade” into gold? When money is politicized, everyone becomes a speculator in political risk.
Now apply the integrity test. If a system cannot protect its own rate‑setting committee from intimidation, how likely is it to protect ordinary citizens from currency debasement? Powell’s warning that the investigation threatens the Fed’s ability to set rates without political pressure should alarm anyone who assumes that official independence is enough. Lawmakers are already vowing to oppose any new Fed chair due to the subpoenas. Both Republicans and Democrats acknowledge that the Department of Justice’s (DoJ) credibility is now in question. When trust in institutions erodes, the flight to hard assets is rational. Gold’s record price is an indictment of the system.
A depoliticized monetary system built on BSV passes the integrity test. There is no central committee to subpoena. No politician can threaten a miner with prison time. Rules are enforced by machines and audited by anyone. The price of money reflects the time value of capital, not the mood of an officeholder. That is not to say there will be no volatility. Markets are volatile by nature. But volatility arising from supply and demand is a feature of honest price discovery; volatility arising from political intervention is a symptom of corruption.
The investigation into Jerome Powell’s renovation testimony is a cautionary tale. It reveals how thin the wall is between monetary policy and political power. Markets are reading the story and hedging with gold and volatility. Lawmakers are sounding alarms. The Federal Reserve chair himself is telling us that the independence of the institution is under threat. We can pretend that this is a temporary spat, or we can recognize it as a systemic flaw. Depoliticized money is not an abstract dream; it is a necessity if we want honest price signals and durable prosperity.
BSV provides the only architecture that scales this vision, so we can build now or live with the consequences of continuing to ignore the fragility of having our lives managed by Big Banks, Big Tech, and Big Government.
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Source: https://coingeek.com/depoliticize-the-fed-crisis-and-bitcoin/