$ZEC
Storm warning! A historic interest rate hike from the Bank of Japan is coming? Bitcoin may face a new round of deep sell-off
A macro test that can stir the BTC market is just around the corner! From December 18 to 19, the Bank of Japan's monetary policy meeting will soon commence, and the market generally bets that Japan will end its years-long ultra-loose monetary policy with a historic interest rate hike. This event coincides with the current turbulent technical situation of Bitcoin, and under the dual pressure, market volatility is likely to be at its peak!
Why can Japan's interest rate hike affect the crypto market? The core mystery lies in yen arbitrage trading! For decades, the yen has had a long-term low interest rate, making it a zero-cost cash machine for global capital, with massive funds borrowing yen to purchase high-volatility assets like Bitcoin. Once the Bank of Japan starts raising interest rates, borrowing costs will soar, and arbitrage funds will inevitably rush to close their positions, with Bitcoin being the first to be sold off!
Looking at historical performance, this is definitely not unfounded. At the beginning of December, when the Bank of Japan just released some hawkish signals, Bitcoin immediately plummeted, showing how sensitive the market is to this policy direction. Now, as interest rate hike expectations grow stronger, the tension in the crypto market has reached its peak.
Do you think this time the interest rate hike from Japan will be the last straw that breaks Bitcoin's back? Is it better to reduce positions in advance to hedge, or to bet that the bearish sentiment will end and buy at the bottom?
