The yen has been falling continuously, and the Bank of Japan has sounded an internal alarm. A wave of aggressive interest rate hikes far exceeding market expectations is approaching, which means that the financing costs of global risk assets are about to be repriced.

"If the yen continues to depreciate, prices may spiral out of control." When the Central Bank governor uttered these words, the last glimmer of hope in the market was completely shattered.

The previously indecisive Bank of Japan is now forced to embark on a path of accelerated interest rate hikes. JPMorgan's latest research provides a clear forecast: there will be two rate hikes in 2025, and by the end of 2026, the interest rate may surge to 1.25%. This will not only affect Japan domestically but also represent a liquidity shock on a global scale.

**Risk signals have been activated**

The depreciation of the yen has already hit the bottom line that the Central Bank cares about the most - price stability. The "upside risk" mentioned by the governor is the most direct signal for policy to shift.

No one is debating the question of "whether to raise interest rates" anymore; everyone is pondering "how fast and how aggressively to raise them." The heart-wrenching question at the press conference—"Is the action too slow?"—aptly expresses the urgency of the situation.

The interest rate curves drawn by investment banks are very steep, which means that one of the cheapest sources of capital in the world over the past 30 years is being rapidly tightened.

**The global financial system is about to change**

The shockwave will spread outward like ocean waves. The first to be affected will be the "yen carry trade," which the global financial markets have long relied on.

In simple terms, international capital has long been borrowing yen at nearly zero cost, then exchanging it for dollars or euros, using that money to buy higher-yielding assets—such as U.S. stocks, U.S. bonds, and then cryptocurrencies like Bitcoin. This model has been pushing up the prices of global risk assets.

Once the Bank of Japan really starts to raise interest rates, the cost structure of this game will change completely. Once the cheap yen financing channel is closed, global liquidity will noticeably tighten, and the attractiveness of high-risk, high-return assets will naturally decline. For the cryptocurrency market, this impact will be quite direct.