MARKET DECLINE ON SATURDAY DUE TO CONCERNS FROM BOJ

Last Saturday, the market declined across the board: Bitcoin – Ethereum – Nasdaq – Russell 2000 all fell in one wave. This is not just a crypto issue, but a macroeconomic reaction to BOJ (Bank of Japan).

1. BOJ will raise interest rates to 0.75% at the December meeting

- A Reuters poll shows that 90% of economists predict BOJ will raise interest rates from 0.50% to 0.75% at the meeting on December 18-19, 2025, which is the first meeting since BOJ ended its ultra-loose monetary policy.

=> After Governor Kazuo Ueda clearly signaled the possibility of raising interest rates, the market has been pricing in

2. Impact on financial markets

- BOJ interest rates rising increases capital costs with the Yen, affecting global liquidity; Japan is shifting from its role of providing cheap money to the world to prioritizing domestic stability, ending a decades-long era of cheap money. And immediately the market prices in the news:

- Nasdaq and Russell 2000 dropped first

- $BTC and $ETH fell in the same wave

- Altcoin weaker, reacting more strongly

3. Previous interest rate hikes by BOJ - how did the market react?

- 19/03/2024 BOJ ends negative interest rates $BTC drops ~23%

- 31/07/2024 next interest rate hike BTC drops ~26%

- 24/01/2025 another hike early 2025 BTC drops ~31%

=> These drops may be due to various other factors from the FED and other elements, possibly just coincidental

4. What scenarios for the upcoming official BOJ meeting?

- BOJ raises interest rates as expected

- BOJ raises interest rates and signals continued tightening in 2026

- BOJ delays or softens more than expected, exceeding expectations

- What do you think?