The recent signals from Bank of Japan Governor Kazuo Ueda about continued rate hikes have directly caused panic in the crypto world. Veteran trader A-Kai's judgment is straightforward: "This wave will likely cause some pain."

The reason isn't complicated. Over the past 25 years, the 4 trillion USD in carry trade funds accumulated under the low-interest environment of the yen are now rushing back to Japan as the cost of rate hikes skyrockets. As for high-risk assets like cryptocurrencies, when funds shrink, they are the first to be hit and sold off.

Looking at recent data makes this clear. As of December 23, BTC spot net outflow was 333 million USD in 24 hours, and ETH also saw an outflow of 81.56 million USD. This isn't a small wave; it's a clear signal of risk aversion and flight to safety.

A-Kai also revisited last year's example: in July, when the yen's interest rate increased, BTC dropped 20% within a week. Now, the market has already priced in this expectation. BTC is fluctuating around the 90,000 USD mark, and those with high leverage are already counting the days, worried about forced liquidations.

But it's not all pessimism. Stablecoins have become a safe haven—USDC saw a net inflow of 168 million USD in 24 hours, and FDUSD also added 7.72 million USD. Plus, some altcoins surged sharply on short-term hot money speculation, with LIGHT soaring over 70% in a single day and SOPH up 40%. It seems there might be opportunities.

However, there's a trap to be aware of. A-Kai specifically warns that these coins have extremely concentrated trading volumes and are highly volatile, with no real value support—it's purely emotional speculation. Assets that rise quickly often fall even faster, so don't get caught holding the bag.

So, how to respond now? A combination of offense and defense:

First, use less leverage. The current crypto market financing rates are not low; don't wait until the rate hike is truly implemented and a deleveraging wave sweeps through.

Second, accumulate stablecoins like USDC with regulatory backing, and keep cash ready for the pullback to buy the dip.

Most importantly, avoid those skyrocketing altcoins. They are likely traps set by major players to offload holdings—don't be blinded by the rapid gains.

What to watch next? Keep an eye on the yen's appreciation. 1 yen is now worth 0.00642 USD. How much the yen appreciates in the future will be a real indicator of capital flow. If you monitor this indicator correctly, you'll know how to act later.