BOJ lifts policy rate to 1% amid yen carry unwind risk

BOJ raises its key rate to ~1.0%. Crypto desks watch yen carry risk and liquidity.

The Bank of Japan lifted the uncollateralized overnight call rate by 25 bps to around 1.0%. The policy decision passed 7–1, per the BOJ monetary policy statement.

Japan sits at the center of the yen carry trade. Dearer yen funding can force deleveraging across risk assets. That includes Bitcoin, Ethereum and crypto derivatives.

The BOJ also flagged monthly JGB purchases of ¥2 trillion from April 2027. This guides longer-term liquidity alongside the front-end move in the same statement.

The central bank did not mention digital assets. Any crypto impact is indirect via funding costs and the yen statement.

Why it matters for crypto
- Higher yen rates can unwind carry trades and pressure leveraged positions
- Liquidity shifts can amplify moves in BTC, ETH and broader risk
- Traders will watch yen strength, funding rates and open interest

What to track next
- Does the yen strengthen enough to trigger deleveraging
- Do funding costs and liquidation clusters rise if volatility picks up