HOW JAPAN'S INTEREST RATE MIGHT HAVE AFFECTED CRYPTO

Summary from the TLDR Crypto newsletter

A small 25 basis point interest rate hike by the Bank of Japan triggered a massive sell-off in risk assets, including a sharp drop in Ethereum, due to the unwinding of the carry trade. This trade, where investors borrow cheap Yen to invest in higher-yield assets, is now collapsing as higher interest rates strengthen the Yen, forcing traders to sell assets to cover their more expensive Yen-denominated loans, leading to a cascade of liquidations.