Bitcoin Boost Predicted Amid Emergency Liquidity Surge for Yen: Swan’s Take

Key Points

A weakening Japanese yen could potentially impact U.S. treasuries, potentially benefiting Bitcoin (BTC).
Swan Bitcoin's executive suggests that the current financial uncertainty could lead to increased investment in riskier crypto altcoins.

Implications for Japan and the U.S.

The devaluation of the yen could potentially spell disaster for Japan and the U.S. This is because Japan is the largest holder of U.S. treasuries, with only 4% of its forex reserves in gold, and the rest almost exclusively in U.S. treasuries, as explained by Dante Cook, Swan Bitcoin's head of business.

Cook suggests that unless the U.S. government intervenes with swaplines or backdoor liquidity, Japan may be forced to sell off its U.S. treasuries to support its currency. This could lead to uncertainty in traditional securities and a surge of liquidity in the market, potentially benefiting Bitcoin.

Bitcoin's Current Status

Cook noted that Bitcoin has already been receiving a wave of liquidity from institutional investors since the U.S. Securities and Exchange Commission approved 11 spot Bitcoin ETFs in January. Since their launch, these ETFs have seen total net inflows of $11.78 billion. Bitcoin is currently trading at $61,399, showing a 6.29% increase over the past week.

He further suggested that the current state of uncertainty in traditional financial markets could lead to more people investing in riskier crypto altcoins. Cook also pointed to the recent announcement by VanEck, a spot Bitcoin ETF issuer, of its MarketVector MEMECOIN index, which includes Dogecoin (DOGE), Shiba Inu (SHIB), PEPE (PEPE), Dogwifhat (WIF), Floki (FLOKI), and Bonk (BONK).