Japan's expected interest rate hike may suppress the liquidity of risk assets such as Bitcoin

According to Coindesk, the Bank of Japan is expected to raise interest rates to 0.75% at the meeting, which will be the highest level since 1995 and will impact global markets, including cryptocurrencies.

Rising interest rates in Japan will reduce the attractiveness of the trade and may force markets that are most sensitive to leverage and liquidity (including Bitcoin) to adjust their positions. A stronger yen typically accompanies a reduction in macro portfolio risk, and this dynamic may tighten liquidity conditions, which have recently helped Bitcoin rebound from its lows.