Recently, Bitcoin has fallen from $126,000 to $87,000, and this decline is far more than just a technical adjustment. The underlying driver is quite clear—the shift in global central bank policies is profoundly reshaping the valuation logic of risk assets.

Speaking of which, the recent rate hike by the Bank of Japan seems modest (only 0.25%), but the symbolic significance of this move far exceeds the numbers themselves. Over the past two decades, the Japanese yen has served as a "cheap financing tool" in the global financial system. Wall Street institutions and various funds operate in a very unified manner: borrowing yen at nearly zero cost, then converting to USD or EUR, and investing in high-yield assets like US stocks, US bonds, or Bitcoin. This cycle is known as "yen carry trade," which acts like a massive reservoir continuously supplying cheap liquidity to global risk assets.

Now that the Bank of Japan is serious about tightening, the cost structure of carry trades has been directly disrupted. Borrowing yen has become more expensive, and the market generally expects the yen to appreciate. For institutions holding massive yen positions, this is a double blow—they face higher financing costs and also suffer from exchange rate losses due to yen appreciation.

Meanwhile, the Federal Reserve is also playing its own "internal struggle" script. Hawkish and dovish voices are each asserting their views, and market expectations for future rate cuts are constantly changing. This policy uncertainty hits the most highly leveraged and sensitive assets first—Bitcoin being at the forefront.

The combined forces of Tokyo's "liquidity withdrawal" and Washington's "dilemma" are effectively pressing all risk assets to the ground. In the short term, passive stop-losses and active position reductions are creating a snowballing effect. But this is also a test of mindset and strategy. More important than blindly bottom-fishing or rushing to cut losses is understanding the logic behind this storm, rather than dancing to emotional tunes. In this market, understanding the big cycle is a hundred times more important than blindly guessing daily charts.