Cryptocurrency Market Faces Major Downturn Amid Economic Turmoil
The cryptocurrency market experienced a significant downturn after a positive start to the week, with many top digital assets declining by double digits. TRX was the only top 20 digital asset to gain, rising by 2.7%, while toncoin increased by 8.9%.
The reversal began after the Federal Open Market Committee (FOMC) voted to keep interest rates unchanged, despite U.S. President Donald Trump's calls for a 300 basis point cut. This was followed by reports of new tariffs imposed by the Trump administration on several countries, leading to a rapid decline in digital asset values. Although most digital assets later recovered, the release of disappointing jobs data by the Bureau of Labor Statistics (BLS) on August 1 further unsettled the markets.
Trump's decision to fire BLS commissioner Erika McEntarfer shortly after the jobs data was released contributed to a significant drop in U.S. stock markets, which lost $1.1 trillion that day. The cryptocurrency market was also affected, with its market capitalization falling from a weekly high of $4.024 trillion to $3.753 trillion, a decline of approximately $270 billion.
Bitcoin (BTC) dropped to $112,680 at one point and closed the week nearly 4% lower, trading just above $113,300. Ethereum (ETH) also fell, with seven-day losses of 6.3%. XRP continued to struggle, dropping 8.2% after a near double-digit decline the previous week.
Other notable double-digit losses were recorded for solana (SOL) at 12.6%, dogecoin (DOGE) at 16.1%, and cardano (ADA) at 13.7%. FARTCOIN and BONK also saw significant losses, dropping 32.9% and 28% respectively.
