According to The Kobeissi Letter, Japan's real wages fell sharply by 2.1% year-over-year last month, marking the largest decline in over two years (source: @KobeissiLetter, May 25, 2025). With inflation rebounding and wage growth lagging, the Bank of Japan is unlikely to raise interest rates in this environment. This scenario may further weaken the Japanese yen, potentially driving increased interest from Japanese investors in cryptocurrencies as an inflation hedge and alternative asset class. Crypto traders should monitor yen movements and BOJ policy signals, as sustained currency weakness could spur capital flows into Bitcoin and other digital assets.

According to The Kobeissi Letter, Japanese private financial institutions sold $17.5 billion in long-dated foreign bonds, primarily US Treasuries, during the week ending April 4th, followed by an additional $3.6 billion the next week, marking the largest two-week sell-off since 2020 (source: The Kobeissi Letter, Twitter, April 26, 2025). This significant outflow from US Treasuries has led to increased volatility in bond yields, which could influence risk appetite across global markets, including cryptocurrencies. Traders should monitor Treasury yields for signals of liquidity shifts that may impact crypto prices and volatility.