If the Yen Starts Hiking Rates, Will Bitcoin Fall Further?

TL;DR

• BTC has firmly defended the $84,000 support zone despite yen-hike fears; ETH holds above $2,800.
• On-chain data shows massive bottom-buying over two weeks ago remains untouched, and long-term holder selling has eased since late November.
• This week’s key events: possible BOJ rate hike (yen strength → carry-trade unwind risk) and Fed decision on December 10 (88% probability of a 25 bp cut).
• Altcoins remain weak; even upcoming catalysts like Bittensor’s halving fail to attract buying interest.

Introduction

As of early December 2025, Bitcoin continues to trade in a wide range between $84,000 and $94,000, showing remarkable resilience despite renewed macro pressure. Last week, market chatter about an imminent Bank of Japan (BOJ) rate hike triggered widespread risk-off sentiment across cryptocurrencies. Many participants feared that a stronger yen would accelerate the unwinding of yen carry trades, reducing global liquidity available for risk assets including BTC.

Nevertheless, Bitcoin has repeatedly bounced from the $84,000 region and has not closed a daily candle significantly below it. This price action suggests that, for now, the strong support levels established in late November remain valid even against clear negative headlines. For investors trying to assess whether we are on the verge of a deeper correction or simply experiencing another healthy consolidation, the evidence currently leans toward the latter.

BTC and ETH Still Have Strong Support

Roughly two-and-a-half weeks ago, large capital inflows appeared exactly at BTC $84,000 and ETH $2,800. On-chain analysis from Glassnode confirms that these positions have seen virtually no spending or redistribution. Holders who accumulated at those levels are still in profit and show no signs of capitulation.

Source: Glassnode

Source: Glassnode

Additionally, selling pressure from long-term Bitcoin holders, which intensified after the all-time high near $109,000, has noticeably slowed since late November. Metrics such as the Long-Term Holder SOPR and coin-days-destroyed have returned to more neutral territory. Reduced old-coin movement is typically a bullish signal, as it removes a major source of overhead supply.

Source: Glassnode

As long as $84,000 for Bitcoin and $2,800 for Ethereum remain unbroken on a closing basis, it is difficult to argue that the broader bull market structure has been invalidated. These levels now act as the market’s line in the sand.

This Week’s Macro Focus: Yen Hikes and Fed Decision

The primary catalyst this week is the potential BOJ rate hike. Governor Kazuo Ueda has strongly hinted at another 25 bp move if wage and inflation data cooperate. A higher yen would make carry trades (borrow yen, buy higher-yielding assets) less attractive, potentially forcing some leveraged positions to unwind. This mechanism contributed to the August 2024 crash and remains a valid concern.

However, the market has had several weeks to price in a gradual, well-telegraphed hike. If the move stays within expectations, the negative impact may be short-lived. Historical episodes show that once uncertainty is resolved, fear often dissipates quickly.

In addition, on December 10, the Federal Reserve will announce its decision. The CME FedWatch Tool currently shows an 88% probability of a 25 bp cut. The direction is almost certain; the tone is what matters. A clearly dovish statement would offset much of the yen-related pressure, while unexpectedly hawkish commentary about slowing the pace of cuts in 2026 could trigger fresh selling in risk assets.

Source: CME FedWatch Tool

Altcoins Still Show No Signs of Recovery

While Bitcoin and Ethereum benefit from deep liquidity and institutional backing, most altcoins continue to lag. Zcash (ZEC), which briefly rallied to $700 on privacy-upgrade optimism, has since fallen nearly 50% to around $357. More telling is Bittensor (TAO): despite its first-ever halving scheduled for approximately December 14—an event that traditionally sparks buying—the token has declined from $315 and struggles to find bids.

When even a straightforward supply-shock event fails to generate upward momentum, it reveals that broader altcoin sentiment remains damaged. Retail participation is low, and speculative capital prefers to stay parked in BTC and ETH until clearer risk-on signals emerge.

Conclusion

A Bank of Japan rate hike would undoubtedly create short-term headwinds for Bitcoin by threatening carry-trade liquidity, but the damage should be contained as long as the move is anticipated and the Fed delivers the expected cut. More importantly, Bitcoin’s refusal to break $84,000—backed by untouched on-chain accumulation and easing long-term holder sales—suggests that the bull market foundation is still intact.

Altcoins, by contrast, need significantly more time and positive catalysts to repair sentiment. For now, prudent investors can view dips toward $84,000 as accumulation zones rather than the start of a new bear market. Until that level cracks, the path of least resistance for Bitcoin remains sideways to higher once this week’s macro events are digested.