Crypto’s taking another hit today, with the total market cap falling back to just above $3T. Bitcoin, Ethereum, XRP, and BNB are all sliding again; Bitcoin is now at $86,545, Ethereum at $2,802, XRP at $2.01, and BNB at $828.
But the bigger plot twist is coming from Japan. Bond yields in Japan are shooting up fast; the 10-year just climbed to 1.877%, the highest level since 2008, and the 2-year hit 1% for the first time since before the financial crisis. That’s a huge break from years of super-easy monetary policy.
This is crushing the yen carry trade, which has been huge for crypto. Traders have borrowed trillions in cheap yen over the years and moved that money into higher-returning assets like cryptocurrencies. When yen strengthens and yields rise, those positions become impossible to maintain. Forced selling kicks in fast.
Liquidations hit $536 million in the past 24 hours, mostly long positions getting wiped out. The Crypto Fear & Greed Index dropped to 23, keeping the market in extreme fear territory. Bitcoin’s now about 30% below its October peak above $126,000.
Everyone’s watching the Bank of Japan’s mid-December meeting now. If they signal a rate hike is coming, crypto could drop even harder.
Conclusion
Japan’s monetary policy shift is unwinding the yen carry trade that fueled crypto gains, creating forced selling pressure that could intensify if the BOJ confirms rate hikes in December.
Also Read: Bitwise CEO Remains Optimistic About Solana ETF
