Anyone watching the markets tonight has probably noticed one number: 80%.

This isn't the drop percentage of some altcoin—it's the market's expected probability that the Bank of Japan will raise rates in December. Bitcoin has fallen below $83,000. On the surface, this looks like a technical pullback, but what really has institutions nervous is the invisible capital chain behind it—the nearly $19 trillion global yen carry trade.

The logic is straightforward: if the Bank of Japan actually tightens monetary policy, the vast sums borrowed in yen to buy US stocks and crypto assets for arbitrage will have to close out and flow back. Just look at the charts from Christmas 2022—when the Bank of Japan merely tweaked its Yield Curve Control ((YCC)) policy, global markets underwent a sharp shakeout. The December 19th window is already a thin-liquidity period, so any surprises could amplify volatility.

What’s more noteworthy is the Federal Reserve’s stance. In his recent public remarks, Powell has deliberately avoided policy specifics. This kind of “quiet period” often signals an important turning point. If Japan tightens and the US doesn’t ease, the crypto market could face dual pressures.

But from another perspective, the Fed just sent a key signal—it plans to open “streamlined master accounts” to compliant stablecoin issuers, allowing them direct access to the central bank’s payment system. This is essentially an official pass for regulated stablecoins like USDC, raising both payment efficiency and credibility. DeFi protocols and infrastructure projects deeply integrated with compliant stablecoins could see new growth opportunities as a result.

Looking back, after the Bank of Japan’s first rate hike at the start of 2024, Bitcoin hit a new high within three months. Now, several critical events are stacked up: Powell’s speech this week, PMI data, jobless claims, the December Bank of Japan meeting, and the Fed’s dot plot. These variables will determine the next direction.

The market has already started to react in advance. Is this a short-term correction or a trend reversal? Major volatility often arrives just as everyone holds their breath.