Bitcoin News Update: Yen’s Decline Tests Bitcoin’s Risk Appetite Link as Fiscal Pressures Mount

The rapid drop of the Japanese yen against the U.S. dollar has sparked renewed discussions about its effects on

and global risk assets. Analysts remain divided on whether this trend will act as a bullish driver or signal broader economic instability. Recently, the yen of 157.20 per dollar, a move attributed to Japan’s expansive fiscal measures and the Bank of Japan’s loose monetary stance, which contrasts with the tightening policies seen in the U.S. and Europe. Although that a weaker yen can boost risk appetite—often favoring Bitcoin—analysts warn that Japan’s worsening fiscal outlook complicates this relationship.

Bitcoin’s recent price swings highlight the prevailing uncertainty. The digital asset

, marking its lowest point since April 22 during a broader risk-off movement in November, before recovering slightly to $91,119. that Bitcoin’s technical setup remains fragile, with the cryptocurrency struggling to maintain support at $92,000 and encountering resistance near $102,000. At the same time, stimulus plan, expected to be approved on November 21, is designed to increase domestic liquidity and reclassify cryptocurrencies as financial instruments, which could attract more investors. Still, stands at 240%, and government bond yields have climbed 70 basis points over the past year—signs of deeper systemic risks that could unsettle global markets.

The yen’s depreciation is often associated with carry trades, where investors borrow yen at low rates to invest in higher-yielding assets. This strategy has historically supported Bitcoin during periods of risk-taking. However, Japan’s fiscal challenges have undermined the yen’s status as a preferred funding currency. With 10-year Japanese government bond yields now at 1.84%—the highest in 15 years—the usual link between yields and exchange rates has weakened, reflecting concerns about the country’s debt burden. “Japan is in a bind: raising yields could spark a fiscal crisis, while keeping rates low accelerates yen weakness,”

. This instability is eroding the yen’s traditional role in risk-on environments, making its influence on Bitcoin less predictable.

On the other hand, the Swiss franc (CHF) is gaining traction as a new indicator of risk sentiment, thanks to its lower yields and stable economic backdrop, making it a more appealing safe haven.

recommends that Bitcoin traders now pay closer attention to CHF pairs for broader market signals. This trend underscores shifting global capital flows as Japan’s policies diverge further from those of other major economies.

The consequences of Japan’s fiscal and monetary strategies are already putting pressure on the massive ¥20 trillion yen carry trade.

that rising bond yields could prompt a rapid unwinding of leveraged positions, forcing investors to liquidate foreign assets and bring funds back to Japan. Such moves could intensify the downward trend for Bitcoin, which is already facing tepid institutional interest and slow ETF inflows. : “If capital outflows pick up speed, Bitcoin might experience a steeper decline than anticipated.”

Although Japan’s large-scale fiscal measures could eventually support Bitcoin by increasing liquidity, the outlook remains uncertain. The yen’s significance as a risk barometer is fading, and global markets are watching the upcoming 40-year bond auction in November for signs of further volatility.

in a technical limbo, with buyers defending the $92,000 level but facing strong resistance above $102,000.