Bitcoin risks a further drop toward the $70,000 area if the Bank of Japan follows through with an expected interest-rate rise on Dec. 19, analysts focused on macro forces warned.
According to multiple macro-focused voices, the move could sap global liquidity and put fresh downward pressure on risk assets, with some traders already bracing for a sharp pullback.
Japan’s policy shift matters because higher rates tend to strengthen the yen and raise the cost of borrowing. When that happens, traders who previously borrowed cheaply in yen to invest elsewhere are often forced to unwind those positions.
That process can pull money out of global markets in a short period of time, and Bitcoin has often felt that impact as investors cut exposure during risk-off stretches.
BOJ Tightening Drains Global Liquidity
According to AndrewBTC, every BOJ hike since 2024 has coincided with Bitcoin drawdowns of more than 20%. Based on reports, the analyst pointed to declines of roughly 23% in March 2024, 26% in July 2024, and 31% in January 2025.
Traders are not only watching central bank calendars. Bitcoin’s daily chart also flashed a classic bear flag formation after a steep fall from the $105,000–$110,000 area in November.
Market Positioning Widens Ahead Of Key Data
Bitcoin slipped below $90,000 in thin trading on Sunday, a move that traders took as a cautionary sign rather than a definitive trigger. Based on reports, Ether held up better than many altcoins, suggesting selective risk taking in the market.
Traders are positioning before a busy slate of US data and central bank events that could sway flows. Analyst EX bluntly warned BTC will collapse “below $70,000” under the stated macro conditions, a stark forecast that highlights how crowded bets can amplify moves when liquidity is pulled.
What This Means For Investors
The story tying BOJ policy to Bitcoin’s swings is simple in outline: when funding costs in Japan rise, global borrowing becomes pricier, and risk assets can be sold as positions are reduced.
That dynamic helps explain why past BOJ moves lined up with 20-30% declines in Bitcoin. Still, markets often try to price events ahead of time; a hike that’s already built into prices may have a smaller effect than one that comes as a surprise.
Featured image from Nikkei Asia, chart from TradingView
