According to Mihir (@RhythmicAnalyst) on Twitter, the Bank of Japan currently holds 53% of all Japanese government bonds and 35% of stock ETFs, marking an unprecedented level of central bank intervention in financial markets. This concentration exposes the Japanese capital market to heightened risk, particularly as inflation rates have climbed rapidly in recent months. For traders, this signals potential volatility in Japanese equities and fixed income markets, with possible spillover effects on global risk appetite and cryptocurrency markets, especially Bitcoin and stablecoins often used as risk hedges. Source: Mihir (@RhythmicAnalyst), Twitter, May 30, 2025.

According to The Kobeissi Letter, Japanese 40-year government bond yields have surged dramatically, rising from approximately 0.25% in 2018 and 1.3% two years ago to over a record 3.5% as of May 2025 (source: The Kobeissi Letter, Twitter, May 25, 2025). This sharp increase signals heightened volatility in global bond markets, which can drive risk-off sentiment and liquidity shifts impacting both traditional and crypto markets. Traders should watch for increased volatility in Bitcoin, Ethereum, and other digital assets as institutional capital reacts to rising yields and potential outflows from risk assets.

According to The Kobeissi Letter, Japan's 30-year government bond yield has surged by 100 basis points to a record 3.20% in just 45 days, while over $500 billion in 40-year Japanese government bonds have lost more than 20% of value in six weeks (Source: The Kobeissi Letter on Twitter, May 25, 2025). This unprecedented volatility in one of the world's largest sovereign debt markets raises concerns about global liquidity and risk-off sentiment, which can drive increased volatility in cryptocurrency markets as investors reassess safe havens and asset allocations in response to Japan's bond market instability.

According to The Kobeissi Letter, Japan's 30-year government bond yield rose by 100 basis points to a record 3.20% within just 45 days, marking a significant move in the traditionally stable Japanese bond market (source: @KobeissiLetter, May 25, 2025). Over $500 billion in 40-year Japanese government bonds have lost more than 20% of their value in the past six weeks, signaling heightened volatility and risk aversion in traditional markets. For crypto traders, this rapid shift in Japanese bonds can trigger capital flows from bonds into alternative assets, including cryptocurrencies, as institutional investors seek higher yields and diversification. Monitoring this trend is crucial, as ongoing instability in Japan's bond market could further fuel demand for Bitcoin and other digital assets among both retail and institutional players (source: @KobeissiLetter, May 25, 2025).

According to The Kobeissi Letter, the Bank of Japan (BOJ) now owns an unprecedented 52% of all domestic government bonds, totaling a massive $4.1 trillion on its balance sheet. In contrast, life insurers, banks, and pension funds hold only 13.4%, 9.8%, and 8.9% respectively (source: The Kobeissi Letter, May 25, 2025). This concentration of bond ownership by the BOJ signals continued ultra-loose monetary policy, which could influence global liquidity flows. For cryptocurrency traders, the BOJ's actions may sustain risk-on sentiment and support capital inflows into digital assets as investors seek higher returns outside traditional bonds.

According to The Kobeissi Letter, the Bank of Japan now owns 52% of all domestic government bonds, significantly outpacing life insurers (13.4%), banks (9.8%), and pension funds (8.9%). Bloomberg reports that the Japanese government holds $7.8 trillion in debt. For crypto traders, this central bank dominance signals ongoing yen liquidity and potential devaluation risks, which may drive increased interest in Bitcoin and stablecoins as alternative stores of value and hedges against currency depreciation. Market participants should monitor BOJ policy shifts closely, as changes could trigger volatility in both traditional and crypto markets. (Source: The Kobeissi Letter, Bloomberg)