Bitcoin is We are heading into a critical period The Bank of Japan is preparing what could be its most significant policy move in decades. The central bank is widely expected to raise interest rates by 25 basis points to 0.75% at its December 18-19 meeting, the highest level since 1995 and a clear signal that Japan continues to move away from ultra-easy policy.
This upcoming event has sparked several conversations among crypto traders. Similar policy moves Attacks from Japan have multiple times coincided with the beginning of the Bitcoin price crash.
Japan’s interest rate hike and repeated Bitcoin decline pattern
Crypto market observers are quick to highlight disturbing patterns regarding cryptocurrencies. Bitcoin and the Bank of Japan. Since 2024, each time the bank has raised interest rates, Bitcoin has experienced large price fluctuations and relatively quick corrections.
For example, in March 2024, Bitcoin fell by about 23% after Japan raised interest rates for the first time since 2007. After a similar rate hike in July, it fell by about 26%, but before the January 2025 rate hike there was a significant drop of more than 30%.
Crypto Analyst 0xNobler express your concern, He noted that if this historical trend repeats, Bitcoin could fall below the $70,000 level immediately after the next December decision. The chart he shared shows how each rate hike coincides with the local market's top, followed by a notable downside. The consistency of these moves has turned what might otherwise be dismissed as a coincidence into a data point that many traders are now taking seriously.
Japanese interest rate
This pressure extends beyond just the crypto industry's reaction. Japan is the largest foreign holder of US government debt, and monetary tightening by the Bank of Japan will impact global liquidity markets. As Japan's interest rates rise, the yen appreciates, thereby reducing the amount of surplus capital that can flow into risk assets.
Another crypto commentator known as AndrewBTC echoes this view. Pointed out the repetition of Bitcoin From 2024 onwards, it will fall by 20% to 31% every time the Bank of Japan raises interest rates. He warned that December's rate hike could have a similar outcome, and also noted that $70,000 could be subject to the rate hike. Possible downside target If the pattern repeats.
Bitcoin/USD. Source: @cryptoctlt On X
Bitcoin breaks above long-term support: not everyone is bearish
Despite growing concerns about the Bank of Japan's interest rate hike, the outlook for Bitcoin is not entirely negative. For example, analyst Ted Pillows believes that Bitcoin is currently communicating The monthly EMA-21 is a level that has always served as a launching pad in previous cycles.
Based on this structure, Pillows predicted that Bitcoin could still soar to the $100,000 to $105,000 range in the short term before further price declines occur.
As the December meeting approaches, Bitcoin finds itself caught between a troubling pattern and resilient technical support. Whether Japan's next interest rate hike leads to an immediate further decline or allows for a temporary rally may determine how Bitcoin and other crypto markets end the year.
Bitcoin/USD. Source: @TedPillows by X
Featured image from Unsplash, chart from TradingView
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