Bitcoin $BTC Slips Under $87.5K as Japan’s Bond Yields Hit 17-Year High

Bitcoin started the week under pressure, sliding below $87,500 during early Asian hours after Japan’s bond yields spiked to levels last seen in 2008. The jump in short-term yields strengthened the yen and pushed traders to unwind carry trades, which sparked a wave of crypto liquidations in a low-liquidity session.

Japan’s 2-year yield touched 1.01% after BOJ Governor Kazuo Ueda signaled the bank is considering a rate hike this month. That comment alone fueled yen buying and forced leveraged traders to cut risk across global markets.

Crypto reacted fast:

Bitcoin dropped under $87.5K with more than $150M in long liquidations

Ether slipped toward $2,850 with roughly $140M wiped out

Perp markets stayed thin, which amplified the drop

Polymarket raised BOJ rate-hike odds to almost 50%

Why it matters:

A stronger yen hurts carry trades, and those trades have been a major support for risk assets this year. When funding tightens, crypto often gets hit first, especially during Asia hours where leverage is high and liquidity is light.

Market snapshot:

$BTC : Weak below $87.5K, dealers see more downside if yen strength continues

$ETH : Funding rates cooled sharply as traders cut exposure

Gold: Institutions remain bullish, with Goldman saying most expect prices above $5,000 by 2026

Nikkei 225: Down 1.3% as markets weigh Fed cut expectations and China data

What’s next:

Markets are watching BOJ messaging closely. Any hint of further tightening could trigger more unwinds, more yen strength, and more pressure on crypto through Asia sessions.

Stay alert to BOJ comments and USD/JPY levels — they may set the tone for the rest of the week.

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