The US and Japan conducted a coordinated intervention to support the yen, marking the first joint action since 2011. The Japanese currency had fallen to its weakest level against the dollar in four decades. Japan spent roughly $53 billion in recent intervention efforts, while the US committed to purchasing $5 billion to $10 billion in yen. This threatens carry trade strategies where investors borrow low-interest yen to invest in higher-yielding assets such as crypto. The immediate risk for the crypto market is a liquidity drain if these positions unwind rapidly.
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