The Bank of Japan recently announced the launch of a massive ETF reduction plan—83 trillion yen in assets will be gradually sold over a span of up to 112 years. Behind this seemingly absurd timeline lies the central bank's extreme caution regarding market stability.

Speaking of the BOJ's ETF holdings, this is an old story. Since 2010, especially after the implementation of Abenomics in 2013, the BOJ has adopted an aggressive asset purchase strategy, attempting to stimulate the economy and boost the stock market through money printing and asset support. Today, the central bank has become Japan's true "biggest whale," holding ETFs worth approximately 7% of the entire stock market’s total market capitalization. How significant is this? Imagine an institutional investor controlling one-seventh of the market’s heavyweight assets.

The turning point comes in March 2024. The BOJ ended its long-standing negative interest rate policy and also ceased new ETF purchases. This marks the end of an era. By September 2025, the central bank officially decided to initiate a slow reduction plan. Pay attention to this word—"slow." The average daily sell-off is only about $20 million, a pace almost negligible. Why so slow? The straightforward reason is that the BOJ fears its massive sell-off could trigger a stock market crash. After all, Japan’s stock market has been running at high levels recently, with the Nikkei 225 index repeatedly hitting record highs, leaving little room for any turbulence.

Interestingly, these ETFs held for many years actually contain huge unrealized gains. In other words, their market value is far higher than the original purchase price on the central bank’s books. In theory, selling these assets would generate substantial profits. But the BOJ clearly cares more about a smooth exit rather than rushing to realize gains.

What practical impact might this plan have? For the Japanese stock market, it’s unlikely to cause any short-term shocks—speed is too slow to exert pressure. In the long run, this could help the BOJ gradually return to the role of a "normal central bank," reducing artificial market distortions. Looking at global markets, the symbolic significance outweighs the actual impact. Japan’s normalization process (raising interest rates and reducing assets) might slightly tighten global liquidity, but the effect would be very limited.

For the crypto market, this news has limited direct relevance. Recently, prices of coins like SOL, ASTER, and others have indeed fallen, but this is more due to fluctuations in global liquidity expectations—such as a strengthening yen leading to unwinding of certain arbitrage trades—rather than a direct result of this ETF plan. Frankly, this is more like a "century-long plan" that won’t cause abrupt asset sell-offs.