Recently, the most notable statement from the Bank of Japan is worth paying attention to. They made it very clear — this round of interest rate hikes is not a one-time event, but rather a phase of sustained observation and gradual tightening. The significance of this attitude shift is actually much greater than simply deciding whether to raise interest rates.

For global risk assets, this is not good news, and the cryptocurrency market is even more affected. When central banks shift from easing to gradual tightening, it means the liquidity environment will face pressure. Once developed economies like Japan start to continue raising interest rates, the logic of global capital flows will be restructured. Historically, every such policy shift has been accompanied by a period of adjustment for risk assets.

For cryptocurrencies like Bitcoin and Ethereum, a loose environment is the most friendly. When central banks around the world are releasing liquidity, funds tend to flow into higher-yielding risk assets. But once this logic reverses, investors will reassess the risk-reward ratio, which is unfavorable for short-term market trends.