At 3 a.m., fingers hover over the close position button, cold sweat soaking through the clothes. On the other side of the screen, Tokyo's decision is brewing, enough to rewrite the global market trend. Not long ago, all leveraged positions had been closed—half of the funds converted into stablecoins. This is not surrender, but rather finding the most stable ship before danger arrives.

Tomorrow, the Bank of Japan will implement a major rate hike decision after nearly 30 years. By then, investors relying on "yen arbitrage" liquidity will face not opportunity but harsh reality. And stablecoins have become the only reliable reference point in the eye of the storm.

**Why does this rate hike affect the entire world?**

The Bank of Japan is expected to raise interest rates from 0.5% to 0.75%, with an over 80% probability of the rate hike being implemented. On the surface, it’s just an interest rate adjustment, but in essence, it marks a turning point in Japan’s monetary policy after more than a decade. Its impact, however, is far more complex than the numbers themselves.

Over the past decade, global capital has borrowed yen at near-zero costs and flooded into US stocks, US bonds, and crypto markets. This invisible arbitrage channel has reached a scale of trillions of dollars. This money has supported a large part of global liquidity.

**What chain reactions will unfold?**

The first step is an instant increase in costs. As the yen borrowing rate rises, those once "free" arbitrage trades suddenly become unprofitable overnight. The arbitrage space disappears, and institutional investors have no choice but to sell their assets (stocks, bonds, cryptocurrencies included) to convert back into yen and repay debts. This is the second blow. The third, even heavier, comes when a global synchronized sell-off wave hits: liquidity will plunge into a vacuum, counterparties vanish, and market pricing will fail.

In this context, stablecoins are no longer just a payment tool; they become the last safe anchor in investors’ hands. When volatility strikes, switching to stablecoins can lock in value and wait for market sentiment to stabilize. This defensive property is precisely what is most scarce right now.