The Bank of Japan is set to make a policy decision on the 19th, with market rumors suggesting a potential rate hike of 25 basis points. Why is this news worth paying attention to? The reason is simple—Japan has long maintained a low-interest-rate policy, and institutional investors have generally engaged in the "Yen carry trade": borrowing cheap yen, converting to USD, and then investing in high-risk assets like Bitcoin and U.S. stocks. The interest rate differential yields substantial returns, but risks are also present.

If the central bank actually raises interest rates, the rules change. Higher borrowing costs mean the arbitrage space is squeezed, and institutions will no longer have the incentive to maintain these positions, opting instead to close them—selling Bitcoin to pay back yen loans. The result is a sudden tightening of global liquidity, with highly volatile assets like Bitcoin being the first to be sold off.

History provides us with clear references. After Japan raised interest rates in March last year, Bitcoin fell by 23%; another rate hike in July led to a 26% decline; and in January this year, a rate increase triggered nearly a 30% drop. According to market expectations, if this rate hike targets 0.75%, short-term pressure can be imagined. Some are already speculating whether Bitcoin will test the $70,000 support level.

But don’t be too pessimistic. Such declines are often the result of "expectation killing"—selling off in advance before the news is announced. Once the dust settles, the market may rebound. So the strategy is clear: in the short term, focus on risk prevention and signal monitoring, but the long-term opportunity window has not closed.