Ramazan Eles 
Arthur Hayes, the founder of BitMEX, has issued a cautionary statement, suggesting that upcoming developments in Japan could spell trouble for Bitcoin (BTC) prices.
According to analysts, the ongoing unwinding of Japan-related carry trades could heighten risks for BTC. Although the leading cryptocurrency surged to $58,000 earlier this week, it failed to inspire confidence. Factors like the absence of crypto discussions in the Trump-Harris debate and Trump’s sliding poll numbers have also contributed to Bitcoin’s price fluctuation.
Amid these events, Arthur Hayes delivered a bold message on the X platform, warning his followers:
“The USD/JPY pair is breaking down, heading towards 140. Markets are turning into a ghost town again. Let’s see if BTC can hold on.”
Will Bitcoin Decline as the Yen Strengthens?
Experts suggest that alongside the U.S. elections, the ongoing unwinding of carry trades—which triggered a $49,000 drop in Bitcoin at the start of August—could persist and continue to impact BTC.
In carry trades, investors borrow in low or zero-interest currencies to invest in higher-yield assets. When the Bank of Japan raised interest rates for the first time in August, it led to a massive unwinding of carry trades and caused turmoil in global markets. Hayes is concerned that the “crash” witnessed in August may happen again.
Yardeni Research noted:
“Expectations that the Fed will lower interest rates while the Bank of Japan raises them are strengthening the yen, forcing investors to unwind their carry trades.”
Yardeni also mentioned that if the Fed cuts rates by 50 basis points and adopts a looser monetary policy, carry trade activity may persist.
In summary, the strengthening yen and continued unwinding of carry trades could put further pressure on Bitcoin. Investors should remain cautious amid these potential risks.
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