Content of Powell's speech on July 31, 2025, at 2:30 AM and its impact on the cryptocurrency market.

1. Content of the Speech

1. The interest rate remains unchanged.
The Federal Reserve has kept the benchmark overnight interest rate in the range of 4.25%-4.50%, maintaining a standstill for the fifth consecutive meeting. This decision process has shown rare disagreements, with two board members opposing it, arguing that the current monetary policy is too tight.
2. Economic Situation Assessment
The statement pointed out that the unemployment rate remains low, the job market conditions are still robust, but economic growth "has slowed somewhat" in the first half of the year, while emphasizing that "uncertainty regarding the economic outlook remains high", with both inflation and employment targets facing risks, without specifying when a rate cut might occur.

II. Impact on the Cryptocurrency Circle

1. Expectations for tightening liquidity have strengthened.
Powell has not released any signals for interest rate cuts, making it difficult for the market to see a large inflow of funds in the short term. The cryptocurrency market lacks the driving force of capital, putting downward pressure on the prices of Bitcoin (BTC), Ethereum (ETH), and others.
2. Volatility has significantly increased.
Powell's speech combined with other macro variables has made the cryptocurrency market highly prone to violent fluctuations, with short-term long and short positions increasingly pulling against each other. This has raised the difficulty for investors, as many find themselves in situations where "getting in means getting trapped, and getting out means a rebound."
3. Expectations for stablecoin compliance have strengthened.
Previously, Powell emphasized that the regulatory framework for stablecoins is being advanced, and there is a need to prevent "regulatory arbitrage." Although this wasn't a focal point this time, stablecoins have already attracted the attention of regulators. In the long term, this will help establish a safer trading system and clear obstacles for institutional entry, but in the short term, mainstream stablecoins may face regulatory challenges.
4. Market sentiment differentiation
Short-term traders are cautious and risk-averse due to increased uncertainty, while long-term investors see stable policy signals and begin to position themselves in quality cryptocurrencies and ecological assets. Market sentiment is difficult to unify, and price fluctuations are increasing.
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