Crypto ended July on the back foot, failing to join Friday's rally in U.S. equities as investors reassessed the path for rate cuts after a hawkish Federal Reserve hold and inflation data that stayed well above target. CoinGecko data showed Bitcoin falling 3.5% over 24 hours to $62,464, while the S&P 500 rose 1.7% to 7,437 and the Nasdaq gained 2.8%. Ether dropped 3.1% to $1,863, and total crypto market capitalization slipped 2.3% to $2.24 trillion.
Bitcoin still finished July up 4.3% after rebounding from below $58,000 earlier in the month. The broader CoinDesk 20 index also posted its first positive month in three. Even so, the market entered August with little momentum.
Fed hold came with a harder line on inflation
The Federal Reserve left rates unchanged at 3.50%–3.75% on Wednesday, marking its fifth straight hold. The decision passed on a 9-3 vote, with all three dissenters — Beth Hammack, Neel Kashkari and Lorie Logan — preferring a rate hike. It was the first time since 2016 that three members dissented in the same direction.
Fed Chair Kevin Warsh, presiding over his second meeting leading the committee, left little room for a dovish reading. "There is no soft inflation target, there is no soft implicit target — not on this Committee's watch," he said. He added that "this Fed will not waver."
Data released a day later reinforced that position. June PCE inflation came in at 3.7% year over year, down from 4.1% as energy prices fell. Core PCE was 3.3%, still far above the Fed's 2% target.
Growth data also stayed firm. Second-quarter GDP rose 3.0%, beating forecasts, and the White House said finalized tariffs ranging from 10% to more than 40% on dozens of countries will take effect on Aug. 7.
With growth holding up and inflation proving sticky, the macro picture did not give the Fed a clear reason to ease. In that setting, stocks drew support from earnings strength, while crypto was left without a fresh catalyst.
ETF demand improved, but monthly momentum weakened
Spot Bitcoin ETFs posted net inflows of $233.1 million on Thursday, their strongest day in more than three weeks, according to Farside Investors. The move snapped a four-day outflow streak that had drained $526.5 million.
That rebound did not change the broader monthly picture. July was still on pace to be the weakest month for net inflows into spot Bitcoin ETFs since launch. Ether products held up better. In the week ended July 24, ETH ETFs brought in $103.9 million, roughly three times Bitcoin's tally over the same period.
Options positioning points to a cautious August
Derivatives traders were positioned for a more difficult month ahead. After Friday's $10 billion expiry on Deribit, the $60,000 Bitcoin put became the largest open interest position, with $1.17 billion in notional value. Before the Fed meeting, the market had been dominated by $70,000 and $72,000 call positions.
Seasonal history also added to the cautious tone. Since 2013, Augusts that followed a positive July have produced a median decline of 7.5% for Bitcoin.
UNI outperformed while WLD fell sharply
Among large-cap tokens, Uniswap's UNI stood out on the upside. It rose about 13% on the week to $4.30 after the decentralized exchange introduced Launches, a web app feature that aggregates tokens across launchpads. Volume in stock tokens on Uniswap-powered Robinhood Chain also climbed to $250 million.
The report said UNI's move was also supported by mechanics tied to Uniswap v4. The DAO activated the v4 fee switch through the UNIfication proposal in December, and protocol fees now go toward buying and burning UNI. Higher trading volume, by that design, tightens supply. UNI open interest climbed to 75.8 million tokens, the highest level since February, when BlackRock listed its tokenized Treasury fund BUIDL on the DEX.
Worldcoin's WLD moved the other way, falling 18.5% on the week to $0.31. The drop followed a $52.5 million funding round led by Pantera that included a WLD token sale through the World Foundation. That deal revived supply concerns, and a 43% cut in daily issuance last week did not offset them.
Elsewhere, PUMP gained about 11% on the week on continued buybacks, brushing aside Friday's report that Pump.fun cut staff ahead of token vesting. Privacy coins cooled after a stronger run, with ZEC down 8% over the last seven days.
Corporate holdings and a wallet flaw added pressure
Corporate Bitcoin holders offered little support to the market. Strategy reported a second-quarter net loss of $8.22 billion on Thursday. The company said its roughly 846,000 BTC, acquired at an average cost of $75,578, remains underwater at current prices. It also disclosed that it has sold about $218 million worth of Bitcoin this year to fund preferred dividends.
Sentiment took another hit on Friday after a key-generation flaw in Coldcard hardware wallets allowed an attacker to drain 594 BTC, worth about $38 million, from roughly 500 wallets in a 25-minute sweep.