PANews reported on June 15th, citing CoinDesk, that Bitcoin traders should pay close attention to the Bank of Japan's interest rate decision this week, scheduled for Tuesday. As of the week ending June 9th, leveraged funds held over 115,000 speculative short positions in the yen, the highest level since November 2017. If the Bank of Japan raises interest rates to 1% as expected and hints at further tightening, these short positions could be liquidated, triggering a yen appreciation and impacting yen-funded carry trades. Carry traders borrow yen to invest in high-yield, risky assets, fueling the bull markets on Wall Street and in the bond market for years, and are also considered to have supported the crypto market.

Following the Bank of Japan's interest rate hike in July 2024, a rapid unwinding of short positions triggered a surge in the yen, causing significant volatility in Wall Street, the Nikkei index, and the cryptocurrency market. Bitcoin fell from approximately $65,000 to $50,000 within a week. If Governor Kazuo Ueda hints at faster tightening or a potential rise in interest rates above 1% after this rate hike, the yen will strengthen substantially, triggering financial market turmoil. Cryptocurrencies are most sensitive to sudden changes in liquidity and could be the most severely impacted.