The US Treasury warned several banks on July 31 that it could take decisive action to stabilize the Japanese yen, marking the first American intervention in currency markets in over twenty years. The yen is hovering around 160 per dollar, near multi-decade lows, having touched 162.83 at one point this year. Analysts emphasize that the yen carry trade poses significant risks for risk assets, with Bitcoin historically being one of the first assets sold when these positions unwind. A coordinated US-Japan intervention would carry far more weight than Japan acting alone, both in terms of actual dollars deployed and the signal sent to markets.
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