This morning, at the moment I opened the market software, over $500 million had evaporated from the crypto market, and the accounts of 160,000 traders were cleared in their sleep.

Late at night, a message from Japan struck like a precise scalpel, piercing through the calm of the crypto market. The Bank of Japan raised the benchmark interest rate from 0.5% to 0.75%.

This seemingly small 0.25% was instantly magnified by the market into a liquidity storm sweeping across the globe.

Countless leveraged positions were 'precisely detonated' that night. Data shows that major exchanges liquidated over $510 million in cryptocurrency positions in the past 24 hours, of which about 70% were long positions, and more than 160,000 traders were forced to exit.

01 Eye of the Storm

The 'butterfly effect' of Japan's interest rate hikes can stir up tremendous waves in the crypto market from thousands of miles away, based on the most classic game rules of global capital over the decades—'Yen Carry Trade.'

In the past few decades, international investors have been accustomed to borrowing almost zero-cost yen, exchanging it for dollars or other high-yield currencies, and then directing it toward various high-risk, high-return global assets. The essence of this strategy is to leverage the 'cheapest money' globally for the greatest returns.

When the Bank of Japan starts to tighten the tap on this 'cheapest money,' the rules of the game undergo fundamental changes.

02 Market Pulse

The initial sharp reaction from the market is the panic retreat of high-leverage positions reliant on yen financing. Liquidity-rich crypto assets like Bitcoin and Ethereum are the first choices to be sold off for cash.

This is the strange picture presented by the market: one side shows the 'tightening' signal of rising interest rates, while the other quickly stabilizes after a sharp drop, even repeatedly contesting key positions.

The market is probing a more profound question: is this interest rate hike a one-time 'warning' or the beginning of a long-term tightening cycle?

03 Survival Logic

In this macro environment where 'cheap money' is gradually fading, assets that solely rely on external liquidity are the most vulnerable.

Historical experience shows that when major global central banks begin to tighten monetary policy synchronously, capital will first flee from overvalued and highly volatile assets. Although the crypto market is unique, it is difficult to be completely detached from this global liquidity repricing.

For traders, this means a new era requiring higher sensitivity.

04 New Cornerstone

The turbulence in traditional financial markets once again reveals a harsh truth: when our asset values are deeply tied to the decisions of sovereign central banks, our wealth is forever in a 'passive state.'

Decentralized USD represents a paradigmatic response. It attempts to answer: is there a value storage and exchange medium whose stability does not rely on the credit and decisions of the Federal Reserve, the Bank of Japan, or any single institution, but instead is built on verifiable mathematics and global consensus?

Taking the USDD stablecoin, initiated and operated by the TRON ecosystem, as an example, it constructs a 'deterministic fortress' that attempts to withstand macro fluctuations through three core designs.

First, over-collateralization and on-chain transparency. USDD uses an over-collateralization mechanism, with the underlying assets like BTC and TRX fully disclosed on the blockchain, allowing anyone to verify in real-time. Trust shifts from reliance on institutional reports to reliance on open-source and transparent on-chain data.

Second, decentralized governance. USDD is managed by the TRON DAO community, and its core parameters are determined by community proposals on-chain. No centralized committee can hold 'secret meetings' or make 'unexpected turns,' making the policy path highly predictable.

Third, endogenous driving within the ecosystem. The demand for USDD is rooted in the rapidly developing TRON DeFi, payment, and cross-border transfer ecosystem. Its value support comes from real on-chain economic activities and utility demands, not just arbitrage trading.

05 Building Defenses

In the face of frequent shifts in global macro policies and increasing market interconnectedness, smart money is not only adjusting leverage and positions but also reconstructing the underlying logic of its assets.

Allocating part of the assets to decentralized stable assets like USDD is equivalent to establishing a 'macro volatility isolation zone' in a tumultuous market.

It provides several key values: during panic sell-offs in the market that lead to quality assets being wrongfully punished, it is the 'reserve ammunition' that can strike at any time; after risk assets realize profits, it is the 'safe haven' that converts floating profits into stable purchasing power; more importantly, it represents a practice of asset autonomy.

The tide of global 'cheap money' is receding, and the risks for those relying on this tide for survival are multiplying. Rather than passively guessing the next moves of central banks, it is better to actively examine and strengthen the foundations of one's wealth system.

When the market fluctuates sharply due to interest rate hikes in Japan, Bitcoin battles around $87,000 repeatedly. This position is not only a technical threshold but also a touchstone for observing market sentiment. On-chain data shows that a large number of short-term holders have their cost lines concentrated around this area.

Meanwhile, an interesting indicator is quietly changing: the stablecoin supply on major exchanges is slowly recovering, indicating that some funds are moving away from volatile assets into a 'wait-and-see zone,' waiting for clearer direction.

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