Japan's central bank interest rate hike countdown: The calm before the ETH storm, is your position still stable?

Attention! The Governor of the Bank of Japan, Kazuo Ueda, has just released a key signal: the meeting on December 19 may initiate an interest rate hike, the largest move since 1995! The market is in chaos, but the most dangerous might not be the stock market, but cryptocurrency—especially $ETH. The eye of the storm is forming, are you ready?

The probability of this rate hike has soared to over 80%, with a potential increase of 25 basis points, or even an aggressive hike of 50 basis points. Why is ETH the first to bear the brunt? The collapse of the world's largest "yen carry trade" is behind this: investors borrow yen at nearly zero cost, flooding into high-yield assets like US stocks and cryptocurrencies. And with ETH being the epicenter of DeFi leverage, once the arbitrage funds withdraw, it will face a chain reaction of liquidations.

History always rings alarm bells: in July 2024, when the Bank of Japan raised interest rates, Bitcoin plummeted 23% in a single day, with over 20 billion dollars liquidated across the network. This time is different—markets have partially priced this in advance, and leveraged positions have decreased by 40% from their peak, but the risk remains unchanged. Data shows that nearly 1 billion dollars in leveraged crypto positions still hang in the balance, while ETH's critical support level is at $2,600. If it falls below this level, it could trigger a "very high risk" avalanche of selling.

ETH's Achilles' heel lies in the DeFi ecosystem: layered leverage accumulation and concentrated institutional holdings make it more sensitive than BTC and SOL. If the interest rate hike is confirmed on December 19, a wave of arbitrage liquidations could sweep the market instantly; but if it is unexpectedly delayed, short covering might bring a rebound. However, don't blindly catch the falling knife! Any leveraged position before the meeting is walking on thin ice.

This macroeconomic shift is destined to reshape the cryptocurrency landscape. Can ETH hold the line? Or will it plunge along with the collapse of the yen carry trade? Share your thoughts in the comments: have you reduced your positions, or are you prepared to tough it out? Share your strategy and let's discuss how to cope with this storm!