Today is December 19, 2025, and the Bank of Japan (BOJ) has unanimously decided to raise the policy interest rate by 0.25 percentage points to 0.75%, marking a nearly 30-year high. This signifies Japan's gradual end to the ultra-loose monetary era. BOJ Governor Kazuo Ueda emphasized that this move stems from increased confidence in the economic outlook and the sustainability of inflation and wage growth.

Although the actual interest rate remains significantly negative, the accommodative environment will continue to support activity. However, the central bank has clearly hinted that if the economy is strong, there may be further interest rate hikes in 2026, with the terminal rate potentially reaching 1%. For years, the attractiveness of yen carry trades (borrowing cheap yen to invest in high-return assets) has sharply decreased, which may reduce the inflow of funds into risk assets. After the decision, the yield on 10-year government bonds broke 2% (the first time since 2006), and the yen exchange rate stabilized around 156 after a brief fluctuation. The Japanese stock market (such as the Nikkei 225) performed steadily.

Bitcoin's resilience is evident: historical patterns are not present.

This rate hike has limited impact on Bitcoin, with prices holding steady around $87,000, slightly rebounding to the $87,500 level, which is vastly different from the 20%-30% corrections observed during historical tightening cycles.

Main reasons:

1. Heightened expectations for rate hikes have been priced in by the market, avoiding sudden sell-offs.

2. The yen has not appreciated significantly, resulting in low arbitrage liquidation pressure.

3. Bitcoin fundamentals remain strong: Glassnode data shows that 23.7% of the supply is at a loss, and losses are shifting from short-term holders (13.5%) to long-term holders (10.2%), indicating a buildup of confidence.

4. Global liquidity support: Expectations for Federal Reserve rate cuts and institutional ETF inflows alleviate tightening effects.

Although the market is currently better than expected, some macro experts still warn that the future rate hike path is the key risk. If rates rise to 1% in 2026, liquidity-sensitive assets like altcoins will be the first to be impacted; meanwhile, today’s options expiration amplifies short-term uncertainty and adds volatility factors.

This is the last major settlement before Christmas, with a total value exceeding $3.16 billion, of which Bitcoin accounts for approximately $2.69 billion. Detailed data:

1. Maximum Pain: $88,000 - If the settlement price is close to or below this, many call options will expire worthless.

2. Open contracts: 17,506 call options, 13,309 put options, totaling 30,815 contracts, with a put/call ratio of approximately 0.76-0.81 (slightly bullish overall).

3. Position distribution: Highly concentrated around $88,000, with put options slightly heavier. Unless spot prices decisively break above, the expiration process will be relatively 'closed', and volatility will be moderate and limited, making large increases or decreases unlikely.

Positioning shows traders are patiently waiting for a catalyst rather than forcing direction.

1. Settling below $88,000 would lead to the largest losses for bullish buyers, or trigger liquidations.

2. A breakout above would release upward momentum.

3. Short-term downside risk: If it breaks below the $85,000-$86,000 support, selling may intensify.

This event overlaps with the rate hike, and short-term volatility may be amplified, but the market has partially priced this in, reducing the probability of severe sell-offs.

Finally

In 2025, the overall crypto market corrected 13%, with Bitcoin dropping 8%, and total market capitalization falling below $3 trillion. However, experts view this as a healthy adjustment: a 468% increase over the past two years, annualized at 138%, far exceeding U.S. stocks. Institutions like 10x Research emphasize that after short-term pressure, larger gains are expected from 2026 to 2028.

Short-term caution at the $88,000 key level, while long-term fundamentals remain strongly bullish.