According to The Kobeissi Letter, the Bank of Japan reduced its bond holdings by 6.2 trillion Yen in Q1 2025, marking the largest quarterly decline on record. Over the past five quarters, the BoJ's balance sheet has contracted by a total of 14.2 trillion Yen. This accelerated quantitative tightening signals tightening liquidity in Japanese and global markets, which historically impacts risk assets, including cryptocurrencies like BTC and ETH, by potentially reducing available capital flows and increasing volatility. Crypto traders should monitor further BoJ policy developments for possible effects on global asset correlations and capital movements. Source: The Kobeissi Letter (Twitter, June 18, 2025).