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Yen Rises, but Bitcoin and XRP Lag in Tokyo

The rising yen is weighing on BTC/JPY, XRP/JPY, and other crypto pairs in Tokyo, while dollar trading stays stronger. Concerns about BOJ intervention and higher inflation in Japan are also in play.

By Zenz van der Wielen
• 2 min read
Yen Rises, but Bitcoin and XRP Lag in Tokyo

Key Takeaways

  • Bitcoin, XRP, SOL, and ETH are higher in Tokyo, but they are still underperforming their dollar pairs because the yen is strengthening.
  • The yen climbed to 161.55 per dollar after renewed talk of possible Bank of Japan intervention and rising rate expectations.
  • Japanese capital flows, including GPIF policy, could influence global risk sentiment and, by extension, crypto markets.

Bitcoin, XRP, and other major cryptocurrencies are still posting gains globally, but Tokyo is telling a different story. In Japan, the stronger yen is limiting how far JPY-denominated pairs can move compared with their USD counterparts.

Yen Puts Pressure on Crypto in Japan

The yen strengthened to 161.55 per dollar from 162.42 earlier in the day. That left BTC/JPY on Japan’s BitFlyer up 0.68%, while BTC/USD on Nasdaq was 1.15% higher. The same pattern shows up in XRP/JPY, SOL/JPY, and ETH/JPY, which are all in positive territory but clearly trailing the dollar pairs.

The latest move in the yen follows fresh concern that the Bank of Japan could step in again, or act alongside other authorities, after the currency hit a 40-year low earlier this week. The central bank has intervened before by selling dollars and buying yen to support the currency, although those efforts have usually only worked for a short time. Traders are also reacting to higher US rates and worries about Japan’s finances, both of which are pushing sentiment back toward yen selling.

Inflation Fuels Rate Expectations

The currency also came under more pressure after Japan’s producer price index for June rose 7.1%. That was the fastest annual increase since March 2023 and added to expectations that the Bank of Japan may need to raise rates again. A former central bank official said Thursday that the BOJ could move sooner, with a reading above 2% as the result.

For crypto traders, that matters because the yen and Bitcoin have recently shown an unusually strong positive correlation, often moving in the same direction against the dollar. If that relationship continues, a stronger yen could eventually support Bitcoin, even if BTC/JPY and other crypto/JPY pairs are still lagging for now.

The combination of a weaker dollar and a stronger yen is familiar territory for Japan’s market. Weak Yen Pushes Japanese Firms Toward Bitcoin and XRP already showed how currency pressure can directly shape crypto demand among Japanese companies.

GPIF Remains a Market Factor

There is also a broader story around Japanese capital flows. The Government Pension Investment Fund, the world’s largest public pension fund, oversees about 293.4 trillion yen in assets. It spreads that money across different asset classes and regions, and any shift in that allocation is closely watched because even small changes can ripple through rates, stocks, and bond markets.

The Japanese government wants GPIF and other pension funds to put more money into domestic assets. That push comes as Japanese government bond yields sit near 30-year highs. For European crypto readers, the important point is that these flows can influence not just the yen, but also broader risk appetite in global markets, with indirect effects on crypto prices and trading pairs.

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