Bitcoin sat near 63600 on Monday, barely moved from where it started the week. The real story playing out in markets was something else entirely. Washington and Tokyo took the unusual step of buying yen together on Friday, trying to stop the currency's slide after it hit 163.73 per dollar. Bank of Japan records suggest Tokyo alone spent roughly 36.6 billion dollars on the intervention, though the US contribution remains a mystery.
The move landed because of the carry trade, a bet that has quietly become woven into crypto markets and beyond. Traders borrow yen at 1% interest from Japanese banks, then move that cheap money into higher-yielding assets anywhere in the world. When the yen suddenly strengthens, those positions blow up. Forced to cover losses, traders dump assets to repay loans. Bitcoin traders know this script well.
By Monday the yen had rebounded to 157.57, holding firm near that level. Yet Alvin Kan, chief operating officer at Bitget Wallet, argued the intervention should be read as damage control rather than the start of a real turnaround. The math still favors carry trades. The Federal Reserve's rate sits between 3.50% and 3.75%, while the Bank of Japan remains at 1%. That gap is the whole reason the trade exists. Without either narrowing that spread or seeing traders voluntarily unwind positions, repeated intervention is just buying time, not solving anything. Kan expects more yen weakness ahead unless something fundamental shifts.
This article is informational and does not constitute financial advice. Crypto markets carry significant risk, and trading strategies based on currency movements require careful consideration of your own circumstances.
