Bitcoin and Ethereum are experiencing significant volatility and downward pressure as August 2025 begins, primarily due to macroeconomic factors that are strengthening the US dollar and creating uncertainty in risk markets. The dollar index has risen above 100 for the first time since late May, gaining over 3% in four weeks, which typically prompts traders to reduce exposure to riskier assets like cryptocurrencies.
President Trump’s announcement of sweeping new tariffs has added another layer of complexity to the market dynamics. These tariffs are expected to exacerbate inflation concerns, which could complicate the Federal Reserve’s ability to cut interest rates as aggressively as markets had hoped. This policy uncertainty is creating a risk-off environment where investors are moving away from speculative assets.
The technical picture for Bitcoin reinforces this bearish sentiment, with the cryptocurrency experiencing its longest losing streak since March 2025, falling for five consecutive days and dropping 4.82% over this period. Bitcoin has declined 3.01% to around $113,261, representing its lowest level since July 9 and marking an 8.04% decline from its all-time high of $123,165 reached on July 14, 2025.
