The latest U.S. employment data for July is concerning and lays the groundwork for a possible interest rate cut decision in September.

The data shows that there were only 73,000 new jobs added in July, far below market expectations. More concerning is that the data for the previous two months, after revision, showed a total reduction of 258,000 jobs. This revision reveals that the downturn in the job market is more severe than previously estimated.

The unemployment rate has risen to 4.2%, showing an upward trend for two consecutive months. Although wages are still increasing, with an annual growth rate of 3.9%, the growth rate is gradually slowing down, providing ample space for interest rate cuts.

This employment report triggered a chain reaction in two aspects. First, it cleared the way for the Federal Reserve to implement interest rate cuts; second, it had a significant impact on U.S. Treasury yields.

This situation brings new expectations for the cryptocurrency and stock markets. A moderately slowing economic environment, coupled with moderate monetary easing policies, is good news for mainstream crypto assets like Bitcoin (BTC) and Ethereum (ETH) in the long run.

Currently, investors most hope to see a moderate cooling of the economy. However, we also need to remain vigilant: if employment data continues to turn to negative growth, it may trigger recession fears, leading to capital being withdrawn from all high-risk assets, and the cryptocurrency market will also find it difficult to remain unaffected.

In this complex economic environment, investors need to closely monitor the trends in the job market and weigh potential risks and opportunities. The future trajectory of the cryptocurrency market will largely depend on broader economic indicators and policy decisions.