The post Why the Bank of Japan Could Trigger the Next Bitcoin Crash appeared on BitcoinEthereumNews.com.

Bitcoin traders often focus on the US Federal Reserve. However, the Bank of Japan (BoJ) can be just as important for crypto markets. That’s because Japan plays a unique role in global liquidity. When that liquidity tightens, Bitcoin often drops hard. The ‘Cheap Yen’ is Bitcoin’s Hidden Liquidity Engine For decades, Japan maintained near-zero or negative interest rates. That made the yen one of the cheapest currencies in the world to borrow. Sponsored Sponsored This gave rise to the yen carry trade. The 🇯🇵 Bank of Japan is about to do a rate hike on Friday the 19th, creating massive fear surrounding the Yen carry trade. Bitcoin dumped hard the last time they hiked rates: But why is this exactly? Let’s break it down 👇 What is the Yen Carry Trade? For decades, the Yen has… pic.twitter.com/YjxzOctjnx — Mister Crypto (@misterrcrypto) December 14, 2025 Large institutions — including hedge funds, banks, asset managers, and proprietary trading desks — borrow yen through Japanese banks, FX swap markets, and short-term funding channels. They then convert that yen into dollars or euros. The capital flows into higher-yielding assets. Those assets include equities, credit, emerging markets, and increasingly, crypto. Bitcoin benefits when this funding stays cheap and abundant. Bitcoin is especially attractive because it trades 24/7 and offers high volatility. For leveraged funds, it becomes a liquid way to express risk-on positioning. A BoJ rate hike disrupts that system. 🚨 JAPAN WILL CRASH BITCOIN IN 5 DAYS!!! People are seriously underestimating what Japan is about to do to Bitcoin. The Bank of Japan is expected to raise rates again on Dec 19. That might not sound like a big deal… until you remember one thing: Japan is the largest holder… pic.twitter.com/0a9Aimfn88 — NoLimit (@NoLimitGains) December 14, 2025 Sponsored Sponsored Why a Small BoJ Rate…

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Filed under: News - @ December 16, 2025 10:23 pm