Crypto Market Pulse - August 4, 2025

LAST WEEK RECAP:

After weeks of euphoric momentum, the market finally hit a wall.
Risk assets rolled over this week, as attention snapped back to the macro—and the incoming data didn’t give bulls much to work with. What started as a soft shift in tone became a full-fledged risk-off move by week’s end.

Three hits to the tape stood out:

1. The Fed

As expected, the FOMC held rates steady. But the messaging was anything but dovish. The 9-2 vote to hold was interpreted as firm, and Powell’s post-meeting tone drove that home: “Inflation is further from goal than employment.”

Translation: cuts aren't imminent. The labor market remains “solid,” and inflation is sticky. Markets heard hawkish—and priced it.

2. Tariffs 2.0

President Trump announced a sweeping universal 10% tariff on all trade partners with whom the U.S. runs a surplus. A 15% rate now serves as the tariff floor for countries with trade deficits. It’s an escalation, and markets treated it as such.

3. Jobs Data + Fallout

The July NFP print missed badly: +73k vs +110k expected. But the real gut punch came from the massive downward revisions:

• June revised from +147k to +14k
• May from +144k to +19k
• That’s a combined -258k wiped off the board. It reignited September rate cut hopes, but also raised red flags about underlying economic strength. In a politically charged move, Trump fired the head of the Bureau of Labor Statistics, accusing him of fabricating numbers for political purposes. The move sent tremors through the bond and equity markets alike.

Market reaction was decisive.

• S&P 500 dropped ~2.94% from recent highs, closing at 6,238.
• BTC broke down below support, trading at 114k,
• ETH retraced to 3.5k, giving up a large chunk of last week's gains.
• Even TOTAL3 softened, showing that macro can still overpower crypto-specific tailwinds—at least in the short term.

But it wasn’t all doom.

Amid the macro selloff, the SEC unveiled “Project Crypto”, a potentially landmark initiative for the digital asset space.

• The project includes clear frameworks for ICOs, airdrops, staking, tokenization, and DeFi.
• A strong signal that most tokens won’t be treated as securities,
• Aimed at ending IP/VPN restrictions for American users, re-opening access to previously geo-blocked offerings.

It’s arguably the most progressive stance the SEC has taken in over a decade, signaling a formal pivot toward embracing crypto infrastructure—but this time from the top.

Looking ahead, the macro overhang is back in the driver's seat. While the regulatory momentum in crypto remains powerful, liquidity and positioning will follow the broader risk backdrop. Until rate cut visibility improves—or the tape stabilizes—staying nimble is the only position that matters.

• Germany GDP Growth YoY Flash 0.4% vs 0.2% expected
• US GDP Growth Rate QoQ Adv 3% vs 2.4% expected
• Bank of Canada holds rates at 2.75% as expected
• US Federal Reserve holds rates at 4.25% - 4.5% as expected
• Bank of Japan holds rates at 0.5% as expected
• US Core PCE Price Index MoM 0.3% as expected
• US Personal Income MoM 0.3% vs 0.2% expected, Personal Spending 0.3% MoM vs 0.4% expected
• US Non Farm Payrolls 73k vs 110k expected
• US Unemployment Rate 4.2% as expected
• June NFP was revised down by 133,000, from +147,000 to +14,000
• May NFP was revised down by 125,000, from +144,000 to +19,000
• US ISM Manufacturing PMI 48.0 vs 49.5 expected
• Trump announced universal tariffs will remain at 10% applying to countries with which the US has a trade surplus, while a 15% rate serves as a new tariff floor for countries in which the US has a trade deficit.
• Trump fired the commissioner of the Bureau of Labor Statistics, whom he accused of manipulating the monthly jobs reports for "political purposes.
• The SEC announced “Project Crypto”, an initiative to modernize Digital Asset regulation, aiming to position the United States as a global leader in blockchain finance, with clear rules for ICOs, airdrops, staking, embracing tokenization, DeFi, and super-apps.

BTC WEEKLY VIEW

BTC has pulled back to the previous high-volume node after consolidating at the top, finding support around the 112K level — a former resistance turned support zone. Given the bearish divergence that appeared during the prior rally, this area is likely to see some sideways action before a clear directional move emerges. It looks like a short-term top has formed.

ETH WEEKLY VIEW

ETH has moved in line with our expectations last week, pulling back near the 4K level. It found support at the daily MA30. While the overall moving averages still suggest a bullish trend, short-term downside risks should not be ignored. This upward leg appears to be coming to an end, and the price likely needs more time to consolidate sideways or correct further downward to digest the recent gains.

ETH/BTC

ETH/BTC reversed at a key resistance level, in line with the broader market performance.

TOTAL3 USD MARKET STRENGTH

TOTAL3 found support at the lower band of the daily Bollinger Bands, suggesting the recent decline may be easing for now. The price will likely consolidate sideways in this area before making its next directional move. Short-term volatility is expected to remain subdued.

TOTAL3 BTC MARKET STRENGTH

Recently, TOTAL3/BTC appears to be consolidating above the MA30, suggesting a potential healthy correction before the next move.

MARKET LEVERAGE RATIO

The market leverage ratio failed to break through the previous supply zone, lacking momentum to assist trapped positions. After the reversal, it’s crucial to monitor when support is regained, assess volume and market sentiment, and patiently wait for confirmation signals.

SUMMARY

• Macro headwinds return: Hawkish Fed messaging, surprise tariffs from Trump, and weak jobs data (with major downward revisions) triggered a sharp risk-off move across markets.
  
• Crypto not immune: BTC and ETH broke down alongside equities, showing sensitivity to broader macro despite recent sector-specific momentum.
  
• Regulatory silver lining: The SEC’s “Project Crypto” marks a major pro-crypto shift, offering clearer frameworks and expanding U.S. access—though macro still dominates near-term price action.

DISCLAIMER:

The information in this report is for information purposes only and is not to be construed as investment or financial advice. All information contained herein is not a solicitation or recommendation to buy or sell digital assets or other financial products.

This post was prepared by Kairon Labs Trader Patrick Li, Travis Su, and Kenny Lee.

Edited by: Shirley Castro