The global crypto market has plummeted sharply, dropping 7% of its total value, with new US trade tensions triggering investors’ fears. Bitcoin dropped to AU$115,000, a decline of 3.2%, and Ethereum to AU$3,649, down by 5.7%.
This sector-wide retreat follows the grand White House reveal of a new round of global tariffs aimed at cutting back trade deficits. The surprise policy maneuver has created panic in various financial markets, and crypto is no exception.
Bitcoin Tumbles to $115K as Market Reacts to Tariff Tensions ( Image source: Blockchain Reporter )
Altcoins and Meme Tokens Take a Harder Hit
While Bitcoin and Ethereum bore the initial brunt, altcoins and meme coins bore the deeper wounds. Solana fell by 6.6%, XRP fell by 5.9%, and meme coin PEPE plummeted an astonishing 7.8%. Investors hurriedly shed assets as increasing uncertainty in markets worldwide swept in.
The issue isn’t so much with the tariffs themselves, but rather what they portend, a reversal of protectionist monetary policy. That makes risk-on instruments like crypto even more vulnerable to abrupt changes in sentiment.
Altcoins and Meme Coins Suffer Bigger Losses ( Image Source: Changelly )
Tariff News Rattles Market Nerves
The Biden administration’s decision to introduce new global tariffs, especially on technology- and energy-related imports, shook the world of investing to its foundation. Crypto, being a proxy for risk, felt the impact nearly right away.
Investors are on tenterhooks as tensions heighten diplomatically. Economic countermeasures are anticipated, and the majority are liquidating digital currencies and flocking to more stable portfolio safe havens, temporarily, at least.
But Bitcoin has a Bullish Hint
Despite all the short-term fragility, Bitcoin still posted its record monthly close at AU$115,644 on 31 July. This kind of milestone is more than a figure, it’s an indicator of underlying market strength that doesn’t evaporate in a night.
Experienced investors are quick to point out that price corrections are inevitable in every bull rush. That Bitcoin can close at the all-time monthly high, notwithstanding policy shocks, is a sign that demand is healthy under the hood.
Machine Learning Models Predict Rebound
Market commentators are optimistic but cautious. Sophisticated algorithms like the GPT-4o and Claude 3.5 show that Bitcoin can rebound to AU$119,833 by week’s end.
The forecast is not conjecture. It’s backed by firm technicals. Foremost of these is Bitcoin’s 50-day moving average at AU$111,234. As long as that holds, most traders are optimistic of a temporary reversal.
Investors Polarized: Panic or Opportunity?
There is polarization in the cryptocurrency universe. Some are seizing the opportunity to close out positions quickly, worried the sell-off will keep getting worse. Others are hanging in there, or even buying the dip.
“This isn’t the first time tariffs spooked markets,” said Priya Menon, a Melbourne-based crypto analyst. “What’s new is the extent of adoption. These troughs tend to wash out short-term traders, but the long-term story for Bitcoin remains intact.”
Actually, such troughs sort out the weak hands. For veterans, it’s not a signal to run, it’s a potential setup for the next upleg.
$BTC dumped below $115K today.
Markets are reacting to higher trade costs and global uncertainty.
New US Tarrifs That Hit Today:
• India – 25%
• South Africa – 30%
• Libya – 30%
• Iraq – 35%
• Switzerland – 39%
• Syria – 41%
• Myanmar – 40%Short-term pain… but is… pic.twitter.com/ATjMpiNUzh
— Cas Abbé (@cas_abbe) August 1, 2025
Short-Term Volatility, Long-Term Trend
The crypto market is a fast and occasionally responsive market. Where macro events intersect blockchain markets, there is short-term volatility. But those with their eyes on the larger picture see that what happens in a day or two is not always indicative of the underlying trend.
The continued building out of institutional infrastructure, regulatory clarity enhancing, and increased adoption among retail and institutional investors alike continues to fuel long-term enthusiasm for the space.
Also Read: Blockchain for Good Alliance Leads the Way in AI‑Blockchain Governance at UN IGF
What’s Next?
As markets continue to grapple with the tariff declaration, prices can be anticipated to stay volatile in the short run. Nonetheless, in case sentiment stabilizes and technical support levels hold, we might still witness a stinging rebound among major digital currencies.
Ethereum’s recent dip has it near a significant support level, and Solana, even with the catastrophic drop, remains a front-runner in NFT and DeFi. XRP fundamentals remain robust, especially with ongoing global acceptance of remittance.
In the meantime, investors and traders will be following the U.S.–China narrative and global macro news closely. Crypto does not live in a vacuum, and geopolitics is behind a lot of the action right now.
Final Thought
While a 7% market fall might seem draconian, that’s business as usual in crypto. What’s not normal this time is the reality that Bitcoin was able to close out July at a record-high monthly close. That’s a signal that even with adversity from the outside world, the asset class still has plenty of momentum going.
With the models forecasting a bounce and technicals pointing to steadiness, this drop might not be so much of a crash as it is a reset.
To crypto veterans of yore, that’s not panic, that’s just another Tuesday.
