Bitcoin Chops Around $64K, With Japanese Yen’s Tumble Maybe Signaling ‘Currency Turmoil,’ Analyst Says

Cryptocurrencies,
widely
known
for
their
often
volatile
nature,
were
a
sea
of
calm
Friday
as
the
Japanese
yen’s
tumble
to
a
fresh
34-year
low
against
the
U.S.
dollar
left
traditional
market
observers
mulling
over
potential
knock-on
effects.

Bitcoin

(BTC)
continued
its
recent
choppy
action
during
the
day
within
a
tight
range
around
$64,000,
down
0.9%
over
the
last
24
hours.
The
broad-market

CoinDesk
20
Index
(CD20)
fell
slightly
more
with
smart
contract
network
tokens
solana

(SOL),

ICP
and
decentralized
exchange
Uniswap’s

UNI
declining
2%-4%.

The
Japanese
yen
(JPY)
dove
another
1.3%
during
the
day
–
a
huge
move
for
a
major
currency
–
to
its
weakest
level
against
the
U.S.
dollar
since
1990
after
the
Bank
of
Japan
(BOJ)
held
interest
rates
at
near
zero
and
didn’t
indicate
much
concern
over
the
weakening
currency.
In
the
U.S.,
meanwhile,
continuing
solid
economic
growth
and

stubbornly
high
inflation
are
snuffing
out
hopes
for
perhaps
any
easing
of
monetary
policy
this
year.

“Moves
of
this
size
and
speed
in
currencies
is
not
normal
so
I
expect
some
intervention
or
coordination
fairly
soon
if
it
continues
into
the
next
few
weeks,”
Quinn
Thompson,
founder
of
hedge
fund
Lekker
Capital,
told
CoinDesk.

The
yen’s
devaluation
didn’t
impact
crypto
markets
yet,
but
this
could
change
if
the
BOJ
steps
in
to
prop
up
the
currency,
Noelle
Acheson,
analyst
and
author
of
the
Crypto
Is
Macro
Now
reports,
said
in
an
email
interview.
A
possible
intervention
would
mean
the
BOJ
selling
U.S.
dollar
assets
(U.S.
Treasuries)
to
buy
yen,
and
a
weaker
greenback
could
in
theory
help
crypto
prices,
she
added.

Another
form
of
intervention
could
arrive
from
U.S.
policymakers
deciding
to
inject
liquidity
to
the
markets,
which
could
support
risk
assets
such
as
cryptos,
Lekker’s
Thompson
said.

Read
more:



The
Key
to
Reviving
Bitcoin
Bull
Run
is
the
U.S.
Treasury’s
Refunding
Announcement
Zooming
out,
Acheson
forecasted
that
the
“currency
turmoil
won’t
stop
with
the
yen,”
as
the
recent
jump
in
U.S.
yields
following
sticky
inflation
reports
will
put
a
strain
on
other
currencies,
perhaps
forcing
other
central
banks
to
take
action.

“We
could
see
a
collective
selling
of
U.S.
treasuries
to
raise
cash
to
support
local
currencies,
adding
further
upside
pressure
to
U.S.
yields
while
adding
to
inflationary
pressures
elsewhere,”
Acheson
said.
“This
currency
volatility
and
vulnerability
could
encourage
more
corporate
and
even
sovereign
holdings
of
hedges
such
as
gold
and
bitcoin.”