The cryptocurrency market experienced significant volatility due to the impact of new tariff policies and large capital shifts.
Investor sentiment has become cautious as news about tariffs and asset adjustments continues to occur, causing prices of Bitcoin, Ethereum, and many altcoins to drop sharply, while also affecting crypto-related stocks.
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The new tariffs applied from August to 14 countries caused the financial and crypto markets to shake significantly.
Bit Digital sold all of its Bitcoin, shifting to hold Ethereum with a large amount of ETH worth over $254 million.
Expectations for the Fed to cut interest rates have decreased sharply, putting pressure on investor sentiment and cryptocurrency prices.
The new tariffs affect 14 countries; will the trend continue to expand?
The new tariff policy with rates from 25% to 40% takes effect from August 1, 2025, targeting Asian and African countries, including Japan, South Korea, Malaysia, and South Africa. The President of the United States stated that this is a response to prolonged trade deficits and warned that taxes would increase if there is further retaliation.
Economist Peter Schiff stated that this policy shows a lack of understanding of the nature of trade deficits, as Japan and South Korea's current tariffs on U.S. goods are very low, at less than 2% and 1% respectively. According to him, the main issue lies in the competitiveness of the U.S. rather than the tariff actions of other countries.
Trump’s letters to Japan and South Korea demonstrate a complete lack of understanding of trade. Tariffs have nothing to do with America’s trade deficits with either nation. Japan’s tariffs on U.S. goods average less than 2%, and Korea’s average less than 1%. Our trade deficits…
Peter Schiff, economist, July 7, 2025
Many opinions in the cryptocurrency investment community believe that the tariff moves also have political targets, aimed at countries closely aligned with BRICS and China, while also putting pressure on countries like Japan and South Korea in key supply chains. This tariff war is expected to be prolonged and more complex.
Is the Fed's rate cut outlook becoming increasingly unrealistic?
Hope for a rate cut by the Federal Reserve (Fed) in the September meeting is clearly diminishing. According to the CME FedWatch tool, the probability of a rate cut is currently at 61.9%, down sharply from 90% a few weeks ago. Meanwhile, bond yields are rising despite the tariff disputes, indicating that deficit spending remains a key factor regulating the current economy.
Investors are currently bracing for strong volatility in the financial and cryptocurrency markets in the upcoming period as the impacts from tariffs and monetary policy are simultaneously realized.
Trends in the cryptocurrency market before the impact from tariffs and the Fed
Uncertain atmosphere and concerns about tariffs have diminished investors' risk appetite, a key factor affecting cryptocurrency price volatility. As a result, altcoins are struggling to regain upward momentum.
According to data from July 7, 2025, Bitcoin decreased by 1.56% to below $108,000, stopping at $107,000. Ethereum also slightly decreased to $2,554, while XRP and Polygon had small increases. In contrast, Dogecoin and Solana suffered deeper losses in the market.
The stock market and cryptocurrency miners also declined.
The widespread impact extends beyond the cryptocurrency market, with tech stocks and cryptocurrency miners also suffering negative effects. Stocks of some Bitcoin mining companies fell sharply, while MicroStrategy and Robinhood stocks lost 2% and 1%, respectively. The Dow Jones index dropped 422 points during the trading day, dragging the S&P 500 and NASDAQ to close significantly lower.
The comprehensive decline from the tariff market to cryptocurrencies reflects the increasing instability and risk in the current global economic context.
Market analyst Nguyen Minh Hoang, July 2025
Frequently Asked Questions
When do the new tariffs take effect and what is their impact on cryptocurrencies? The tariffs take effect from 1/8/2025, causing investor sentiment to decline, leading to a simultaneous drop in the prices of Bitcoin, Ethereum, and altcoins. What financial moves has Bit Digital made recently? Bit Digital sold all of its Bitcoin and shifted to hold over 100,000 ETH worth $254.8 million, becoming one of the largest public ETH wallets. Why has hope for a Fed rate cut decreased sharply? The probability of a rate cut in September has fallen to 61.9%, due to the economic situation and monetary policy continuing to be affected by deficit spending and trade disputes. What is the impact of tariffs on crypto-related stocks? Stocks of Bitcoin miners and related tech companies like MicroStrategy all declined in line with negative market sentiment. What upcoming events are crypto investors most interested in? Crypto Week starting on July 14 with important bills like the CLARITY Act and Anti-CBDC Surveillance State Act potentially shaping the next cryptocurrency legal framework.
Source: https://tintucbitcoin.com/bitcoin-ethereum-giam-5-vi-thue-trump/
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