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Bitcoin and the yen risk selloffs if Japan raises rates

CoinDesk notes that tighter yen conditions could unwind Japanese yen funded bets across stocks, bonds, and crypto, a dynamic bitcoin saw during the BoJ rate move in August 2024.

Reported · Written up by our desk · Market Structure

CoinDesk’s Daybook points to a Tokyo report saying U.S. Treasury Secretary Scott Bessent encouraged Japan to raise interest rates to help stem the yen’s slide, highlighting how officials try to influence another country’s monetary policy.

The newsletter contrasts that uncertainty in traditional finance with bitcoin’s built in supply schedule, where new coins enter on a fixed timetable and the pace of new supply is cut roughly every four years.

It warns that even if bitcoin’s long term case is unchanged, a fast yen rise tied to higher Japanese rates could trigger risk aversion, leading to unwinds of positions taken during periods of cheap yen funding across stocks, bonds, and cryptocurrencies.

CoinDesk also recalls that bitcoin faced collateral damage in early August 2024 after a Bank of Japan rate increase pushed the yen higher, prompting a wave of risk selling, and notes chart analysts are watching a potential 50 day moving average crossing above the 200 day line, while cautioning that such indicators lag spot prices.

Latest closeBitcoin $77,351.59 ▼1.5%

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