of japan 20-year government bond yield It reached 2,947 percent, the highest level since 1998. Increasing debt burden and skyrocketing interest costs could cause the country to withdraw trillions of dollars of capital from global markets. According to experts, this development Bitcoin 
$86,989.86It creates a risk of a decrease of 5-8 percent in the price of .
Japan’s Huge Debt Challenges Global Balance
One of the most indebted economies in the world JapanIt carries debt of approximately $10.2 trillion, corresponding to 263 percent of its gross domestic product. This burden, which has been sustainable for decades thanks to low interest policies, is now high. inflation and reached a breaking point with interest rate increases. Borrowing costs are climbing rapidly after the Bank of Japan raised short-term interest rates to 0.5 percent.
The new interest level is the country’s annual interest It can increase its payment from $162 billion to $280 billion in the next decade. This means that approximately 38 percent of government revenues go to interest alone. Economists point out that such a large debt cannot be managed smoothly by any major country.
Impact on US Bonds and Cryptocurrencies
Japan is Washington’s largest foreign creditor, with $1.13 trillion in US Treasury bonds. However, the increase in yen interest rates is due to foreign exchange risk. American bondsIt makes it unattractive. Analysts predict that Japanese investors could move around $500 billion back to the country over the next 18 months, which could push up global bond yields.
This movement is associated with Bitcoin and cryptocurrency marketIt also has an indirect impact on the rest of the population. For years, Japanese investors have raised $1.2 trillion in capital with low-cost loans. cryptocurrencyis known to direct it to stocks and other assets. Now, as yields rise, the recall of these funds could put selling pressure on Bitcoin.
The fact that dollar-pegged stablecoins such as Tether have extensive positions in US bonds also increases the risk factor. As a matter of fact, after the interest rate increase of the Bank of Japan in July 2024, Bitcoin lost 18 percent of its value and fell to $ 53,000. In a similar scenario today, the price could first return to the $87,000 support. However, the Trump administration’s cryptocurrency-friendly policies and ETF inflows may limit possible declines.
