Yen interest rate hike shadow looms: Why the crypto market trembles in the "possibility"

On December 1, 2025, the market's "anticipated panic" officially begins.
"Ding——"
Imagine that the Governor of the Bank of Japan, Kazuo Ueda, just coughed lightly, and the market was so frightened that it went weak at the knees.

On the morning of December 1st, even without a real interest rate hike, the mere expectation of "a possible interest rate hike in December" has pressed global risk assets down to the ground.
Bitcoin fell directly from a high of $92,800 to $86,500, a decrease of nearly 5%;
Ethereum is even worse, being pressed down by 7% in one day, while altcoins are turning dark green.
The entire crypto market's market value evaporated by 80 billion USD in an instant, while the trading volume surged by 150%.
This is not a crash, this is a rehearsal of "anticipated panic."

Hawkish signals are everywhere, with the interest rate hike probability soaring from 50% to 90%.

The Bank of Japan said at the end of October to "observe for a while longer," and in the blink of an eye, it changed its stance in November:
Core CPI has exceeded 2% for 50 consecutive months, rising to 3.0% in November;
The Japanese yen once depreciated to 156.42 against the US dollar, hitting a new low in 10 months;
Former central bank officials and committee members took turns speaking out: "Prices are strong, and we should continue to raise real interest rates."
A Reuters poll shows that more than half of economists believe that the meeting on December 18-19 will directly raise rates by 25 basis points, pushing the interest rate from 0.5% to 0.75%.
The market no longer asks "Will it happen?" but rather "How much will it increase?"
The "alarm bell" of arbitrage trading: $2 trillion of cheap funds are about to dry up.

The most profitable game in the past three years is called "Yen Carry Trade":

Borrow Japanese yen at almost zero cost → Convert to US dollars → Go on a buying spree for Bitcoin, Nasdaq, MicroStrategy...
This wave of funds amounts to 22 trillion dollars, with at least 10% flowing into the crypto market.
Bitcoin rose from 60,000 to 90,000, with nearly 20% of that being money borrowed at 0% interest by Japanese people.
Now, just by adding 25 basis points, the cost of borrowing in yen jumps from 0.5% to 0.75%, and the interest spread instantly shrinks.
All arbitrage positions have only one option: to close the position, pay back, and repurchase yen, even at a loss.

The historical lesson is still in front of us: In July 2024, Japan raised interest rates for the first time, and the yen surged from 161 to 140, causing the crypto market to directly halve by 1 trillion dollars.
Today’s expectations have already made the market tremble like a sieve.

Why is it that the ones who get hurt the most are always encryption?

Because we are the "King of High Beta."
When others drop by 3%, we drop by 8%; when others drop by 5%, we drop directly by 20%.
We are amplifiers of global liquidity and also pressure relief valves.
When the cheap yen floods the market, we soar crazily more than anyone else.
When the yen becomes expensive, we fall harder than anyone else.
This is just the beginning, not the climax.
The Bank of Japan has made it very clear: it will continue to increase until interest rates return to above 1% in 2026.

Today is just the first gunshot, and there will be continuous nuclear strikes afterwards.
If the yen really returns to 140 or even 130, the 80 billion evaporated today is just an appetizer.

Survival Guide for All Crypto Market Brothers and Sisters
1. Check immediately if you have any JPY financing positions (JPY denominated contracts on Bybit, OKX, BitMEX), if so, close them quickly.
2. Spot trading is invincible, but never touch cross-coin leverage again.
3. Be careful with stablecoins as well; today USDT once depegged to 0.995.
4. Keep 20-30% in cash or short-term bonds, living is more important than anything else.
5. You can buy the dip, but don't rush, the real bottom might be at 84k, or even lower.

The last sentence

Today we are not scared to death by the Bank of Japan.
It was terrified by its own greed, leverage, and the illusion of "never raising interest rates" over the past three years.
The Japanese yen hasn't really appreciated yet, it's just "possibly" going to appreciate.
The market has already knelt down.
#十二月行情展望 #比特幣行情觀察 $BTC $ETH