Japan’s Yen Falls Again Despite $97 Billion Aid. Risk For Bitcoin?

Japan’s currency continued to decline, reaching 160.16 yen per dollar on 28 August, erasing more than half of the gains achieved after recent intervention.

Scale of the Intervention

Between 30 July and 26 August, Japanese authorities spent approximately ¥15.4 trillion (about $97 billion) to support the yen. The effort included a coordinated purchase with the United States on 31 July, marking a rare joint action.

Factors Keeping the Yen Weak

U.S. interest rates remain higher than those in Japan, making dollar‑denominated assets more attractive. The dollar received additional support after Federal Reserve Chair Kevin Warsh reiterated the goal of bringing inflation to target.

Potential Impact on Bitcoin

Bitcoin briefly slipped below $77,000 following Warsh’s comments, as investors anticipated higher U.S. rates. A stronger yen could increase the cost of yen‑funded carry trades, prompting traders to sell assets, including Bitcoin, to repay loans.

Historical precedent shows that yen‑funded trade reversals in August 2024 contributed to Bitcoin and Ethereum losses of up to 20%.

Market Sentiment

Metaplanet CEO Simon Gerovich highlighted growing interest from Asian savers in Bitcoin, suggesting a longer‑term demand boost despite short‑term volatility.