Last week (July 29 to August 4), due to macroeconomic and geopolitical factors causing market volatility, BTC and ETH prices temporarily declined. Influenced by the Federal Reserve's hawkish remarks, BTC prices dropped from July 29 to August 2, briefly falling below $112,000, reaching a low of $111,920, then rebounding above $115,000, with a maximum weekly volatility of 6.1%. The current BTC price is stable around $114,307. Last week, ETH experienced increased volatility driven by capital flows, reaching a low of $3,354.28 and a high of $3,886.44, with a maximum weekly volatility of 13.6%, and is currently stable around $3,649 (data sourced from Binance spot market, August 5, 14:47).
Affected by macroeconomic fluctuations, the US stock market's three major indices first declined and then rose last week. By the close of last Friday (August 1), the Dow Jones dropped 1.23%, the S&P 500 fell 1.6%, and the Nasdaq declined 2.24%. On August 4, the US stock market significantly rebounded, with the Dow Jones rising 1.34%, the S&P 500 up 1.47%, and the Nasdaq increasing 1.95%.
Market Interpretation
Non-farm data falls short of expectations, causing global volatility with over $700 million in crypto liquidations
On August 1, the US July non-farm employment only increased by 73,000, far below market expectations and a ten-month low, with previous figures also significantly revised down. The "cold" employment data sparked strong dissatisfaction from Trump, who directly fired the Bureau of Labor Statistics director and accused the data of being manipulated. At the macro level, weak employment data, intense political reactions, and escalating geopolitical tensions collectively drove significant volatility in US stocks and the crypto market.
BTC dropped to $112,751 in the early morning, erasing three weeks of gains, while ETH fell to a low of $3,431. The network's 24-hour liquidation amount reached $726 million, with long positions accounting for 88%, ETH liquidations at $270 million, exceeding BTC's $165 million. Crypto-related US stock sectors generally plummeted, with Coinbase falling over 16%.
Market sentiment was significantly under pressure, risk appetite cooled, and safe-haven funds flowed into assets like gold. However, institutions like ARK Invest took advantage of the pullback to increase holdings in crypto-related stocks, and some whales showed signs of buying at low levels.
ETH price correction diverges from whale large-scale purchases, long-term confidence remains
Last week, ETH experienced a 10% pullback, dropping below $3,400 for the first time in six weeks, reflecting increased short-term profit-taking and deleveraging. Simultaneously, on-chain data showed a whale accumulated approximately $30 million in ETH during the price decline, becoming a market focus.
Despite short-term market sentiment pressure, institutional-level "buying the dip" indicates that key players remain optimistic about ETH's medium to long-term trend. Overall, ETH currently displays a "price adjustment - main force accumulation" divergence structure, with short-term fluctuations primarily influenced by macro pressures and USD strength, while long-term capital inflows are expected to provide market support.
Federal Reserve's hawkish remarks pressure short-term risk assets
In early August, the Federal Reserve maintained the federal funds rate in the 4.25%-4.50% range as expected, with two members advocating for a 25 basis point rate cut. Subsequently, Chairman Powell emphasized in the press conference that tariff increases are driving up prices, short-term inflation expectations have risen, and warned that "not raising rates would be equivalent to ignoring inflation risks". Influenced by these hawkish remarks, BTC price quickly dropped nearly 2% to $115,800, major US stock indices turned from rising to falling, and the Altcoin sector performed even weaker, with ETH, SOL, and XRP all falling nearly 4%. Overall, Powell's signal of policy tightening pressured short-term risk assets.
Market Highlights
White House plans executive order to regulate bank discrimination against crypto industry
On August 5, the White House is planning to issue an executive order to increase oversight of large banks, focusing on investigating and punishing behaviors that refuse services to specific customer groups like crypto companies due to political reasons. This policy direction reflects the US government's strengthening regulatory attitude towards fair competition and inclusive financial services among financial institutions.
SEC approves physical delivery, pushing crypto ETFs closer to commodity standards
On July 29, the US Securities and Exchange Commission (SEC) officially authorized participants (AP) to create and redeem BTC, ETH, and other cryptocurrency ETFs in physical form. Unlike previous cash-only purchases and redemptions, this move aligns crypto ETFs with regulatory standards of traditional commodity ETFs like gold and oil, with physical delivery becoming the new norm.
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