Bank of Japan Rate Hike Could Trigger 20-30% Bitcoin Decline as Markets Price 98% Probability
Markets are bracing for a potentially pivotal week for Bitcoin as the Bank of Japan (BOJ) heads into its December 18–19 policy meeting. Expectations point to a near-certain rate hike.
Prediction markets and macro analysts alike are converging on the same conclusion: Japan is poised to raise rates by 25 basis points. Such a move could reverberate far beyond its domestic bond market and into global risk assets, especially Bitcoin.
Bank of Japan Rate Hike Puts Bitcoin’s Liquidity Sensitivity Back in Focus
Polymarket is currently assigning a 98% probability of a BOJ hike, with a measly 2% wagering that policymakers will hold interest rates steady.
The general sentiment among crypto analysts is that this is not good for Bitcoin, with the pioneer crypto already trading below the $90,000 psychological level.
If implemented, the move would take Japan’s policy rate to 75 basis points, a level not seen in nearly two decades. While modest by global standards, the shift is significant because Japan has long been the world’s primary source of inexpensive leverage.
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