Yen Carry Trade Unwind
One year ago, Bitcoin experienced a sharp decline to $49,000 after Japan shifted monetary policy stance, making the yen less attractive for carry trade strategies. Investors had borrowed yen at historically low interest rates to purchase higher-yielding assets, including Bitcoin. The reversal of this trade triggered a rapid outflow of capital from risk markets, with Bitcoin shedding nearly 30% of its value in a matter of days.
Macro Performance
Since that ejection, Bitcoin has outperformed traditional asset classes. The S&P 500 has gained approximately 24%, while gold appreciated nearly 40%. In contrast, Bitcoin rallied over 130% from its August low, driven by growing institutional adoption and enhanced regulatory clarity. The digital asset’s correlation with risk markets has evolved, reducing sensitivity to short-term macro fluctuations.
Holder Distribution
On-chain analysis from Glassnode indicates that coins held for seven to ten years now constitute more than 8% of total supply, doubling the level from August 2024. The cohort of six-to-twelve-month holders expanded from 8% to 15%, reflecting renewed inflows by mid-term investors. Accumulation behavior supports the thesis that a growing base of long-term stakeholders underpins price resilience.
Bond Yield Dynamics
Global bond yields moved higher over the past year, with the U.S. 10-year treasury yield rising to 4.2% from 3.7%. Similar yield uplifts occurred in the U.K. and Japan, prompting a repricing of risk assets. Bitcoin’s asymmetric return profile has attracted attention among yield-sensitive investors, positioning the asset as an alternative inflation hedge.
Future Outlook
Traders and analysts are evaluating whether Bitcoin can sustain its momentum amid evolving monetary policy cycles. Key levels include $118,000 on the upside and $105,000 for support. Continued accumulation by long-term holders and ETF flow data will likely influence near-term trends. A break above $120,000 could herald a new phase of broader adoption in traditional finance.
Key Takeaways
- The unwind of the yen carry trade sent Bitcoin to $49,000 one year ago, setting the stage for a 130% rally.
- Long-term holder supply share doubled to over 8%, indicating growing conviction.
- Bond yields rise has diversified investor interest toward Bitcoin as a risk asset and potential inflation hedge.
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