The tightening of Japan's monetary policy shakes the global cryptocurrency market

Rugman_Walking · 2026-01-28T04:11:36+00:00

Recent volatility in the Japanese bond market is triggering widespread reactions across global financial and cryptocurrency markets. Japan's monetary policy changes are raising concerns over financial stability, with bond yields reaching a 27-year high. As liquidity tightens and risk aversion rises, investors are shifting towards safer assets, leading to significant market shifts and potential systemic risks in the global finance framework.

Rugman_Walking

2026-01-28 04:11:36

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The extreme volatility in the Japanese government bond market is rapidly spreading to global financial markets and the cryptocurrency market. According to CoinDesk reports, changes in Japan’s monetary policy are triggering unexpected chain reactions. Saxo Bank’s product strategists also warned that this situation is evolving from a regional issue into a global financial stability crisis.

Bond Yields Surge to 27-Year Highs

The yield on 30-year Japanese government bonds has surged by over 30 basis points to reach 3.91%. This is the highest level recorded in 27 years, immediately shocking the market. Experts analyze that this sharp increase fundamentally threatens Japan’s long-standing position as the world’s most stable liquidity provider. This shift signifies a reorganization of global capital flows and has deeply unsettled investor sentiment.

Global Liquidity Tightening and Risk Asset Sell-Off

The weakening of Japan’s liquidity support has heightened tensions in the global financial markets. External factors such as President Trump’s tariff threats have compounded the situation, further deepening risk aversion. As a result, Bitcoin’s price has fallen to around $89.11K, while gold and silver have hit record highs. This is a typical risk-averse phenomenon, showing that investors are making a large-scale shift toward safe assets.

The Bank of Japan’s Dilemma

Analysts point out that the Bank of Japan, responsible for Japan’s monetary policy, is currently facing extremely limited options. Attempting to suppress yields could undermine market confidence, while switching to a tightening monetary policy could worsen the global liquidity crisis. Whatever policy choices are made, side effects are inevitable.

Growing Concerns Over Financial System Collapse

Market participants are increasingly worried that if the current trend of rising yields continues, it could lead to a structural crisis in the global financial system itself. Even if Japan’s abrupt shift in monetary policy is temporary, it could serve as a signal to shake the stability foundation of the international financial system, raising market alertness. The future policy direction of the Bank of Japan is expected to significantly impact both global cryptocurrency and traditional asset markets.

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