Rare Yen Intervention Sparks Carry-Trade Fears as Bitcoin Holds Steady

Bitcoin maintained its price around $63,600 on Monday, despite the rare joint intervention by Japan and the US to support the yen. The move revived concerns about the impact of carry-trade on global markets.

The yen's rebound to 157.57 per dollar after reaching a low of 163.73 on Friday suggests that Tokyo may have spent as much as $36.6 billion in buying yen, according to Bank of Japan data.

Crypto traders closely watch the yen due to its role in carry-trade, where investors borrow cheap Japanese funds and invest them in higher-return assets. However, a sudden rise in the yen can force these traders to close positions and sell other assets to repay their loans.

Alvin Kan, chief operating officer at Bitget Wallet, views the intervention as a check on disorderly trading rather than a lasting solution for the yen's decline. The interest-rate gap between the Federal Reserve and the Bank of Japan still favors the dollar, which may limit the effectiveness of repeated interventions.