The global cryptocurrency market experienced a significant correction in August 2025, with total market capitalization dropping below the $4 trillion mark. The downturn is attributed to declines across major currencies like Bitcoin and Ethereum, following a historic record week fueled by macroeconomic shifts and regulatory changes. 🧠 This correction was impacted by government announcements regarding Bitcoin purchases, with the US Treasury taking steps to avoid direct market involvement while relying on confiscated assets for strategic reserves. 🔥 💼 Notably, the resignation of Bo Hines, head of the US digital asset strategy, added uncertainties about future policies. 📉 🤝 The market downturn also heavily affected established cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH). The price of Bitcoin fell sharply below $119,000 after a record high, significantly impacting those with leveraged positions. The shift in US Treasury stance and its implications for institutional investments are key factors driving this volatility. 🏛️ 💰 The market is anticipating a period of heightened risk-assessment as delayed institutional investment decisions become clearer. Looking back at previous market fluctuations, similar sell-offs have often been followed by periods of increased stability.