The Bank of Japan has just offered indirect support for bitcoin. By cooling expectations of a rate hike at the end of April, it reduces one of the big risks weighing on the crypto market. The signal is discreet, but its effect is powerful: the yen remains weak, financing remains cheap, and risky assets breathe easier.
In brief
- Bitcoin benefits from unexpected support from Japan.
- The Bank of Japan reduces pressure on the markets.
- But this support remains fragile and very dependent on rates.
Bitcoin benefits from a respite from Tokyo
Bitcoin crossed $74,000 in a more favorable macro context. The market didn't just buy technical upside. He also bought monetary relief from Japan.
Kazuo Ueda, governor of the Bank of Japan, adopted a more cautious tone. The war involving Iran and tensions over energy make a rate hike more delicate. For traders, this quickly changes the reading of the market.
The memory of August 2024 remains vivid. At the time, the sudden unwinding of the yen carry trade shook risky assets. Bitcoin had fallen sharply in two days. This time, Tokyo is not yet pulling the rug out.
The carry trade consists of borrowing in yen at low cost to invest elsewhere. When the yen remains weak and rates low, this mechanism supports leveraged positions. This is where bitcoin comes into play. Part of its rally is based on speculative flows. These flows become more aggressive when financing remains cheap.
The danger, however, does not disappear. He is simply pushed away. If the Bank of Japan toughens its tone later, the crypto market could experience a rapid correction again.
Oil and Iran complicate Japanese decision
Japan relies heavily on imported energy. Tensions around the Strait of Hormuz can therefore have a direct impact on its economy. A surge in oil prices would make the situation even more sensitive.
But if talks between the United States and Iran calm oil prices, inflationary pressure in Japan could ease. In this scenario, the Bank of Japan would have less urgency to raise its rates.
For bitcoin, this detail matters. Less pressure on Japanese rates means more time for the market. And sometimes, in crypto, a few weeks are enough to transform resistance into an accelerator.
This Japanese boost does not guarantee a lasting rise in bitcoin. It only removes one important obstacle. That's already a lot in such a nervous market. The $73,000 threshold had long blocked buyers. Between oil, rates, geopolitics and the dollar, traders had little reason to force the market. Only long-term investors have not given up, continuing to accumulate patiently, purchase after purchase. The Bank of Japan's more cautious tone is changing this balance.
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