Rate hike ahead? 🇯🇵

Analysts think Bank of Japan might approve a rate hike Friday. How big a deal will it be for Bitcoin?

Author

Stacy Jones
December 17, 2025

đź“ť What you need to know

Analysts seem certain that the Bank of Japan will approve a rate hike on Friday. If it does, the move could reverse the lucrative yen "carry trade," a major source of global liquidity that has historically fueled rallies in risk assets like Bitcoin. But analysts are split on whether crypto traders should worry.

“The BOJ’s rate hike stealthily normalizes the yen—unwinding the carry trade fuel that’s greased global risk assets for years, flipping liquidity from a gush to a grind,” Czhang Lin, head of LBank Labs and partner at LBank, told Decrypt. This environment, he said, “heralds dollar strength, equity wobbles, and crypto drag.”

Meanwhile, Bitwise Chief Investment Officer Matt Hougan said it might amount to nothing more than a “scary headline.”

Bitcoin Traders Brace for Bank of Japan Rate Hike Amid Crypto Sell-Off

The Bank of Japan's expected rate hike to a 30-year high could unwind the yen carry trade, draining liquidity from risk assets like Bitcoin.

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