The interest rate hike in the United States is well-known, so let me discuss the impact of Japan's interest rate hike on the blockchain (cryptocurrency) market.
Japan's interest rate increases generally create an overall bearish impact on the blockchain and cryptocurrency market.
The rate hike raises the cost of capital and tightens global liquidity, leading to a decline in risk appetite, with capital more inclined to flow into low-risk assets, thus reducing investment in cryptocurrencies such as Bitcoin and Ethereum.
Interest rate hikes often drive the yen to appreciate, causing Japanese investors to withdraw funds from the crypto market back into their own currency or domestic bonds, resulting in additional selling pressure.
