Bitcoin moved toward the $88,000 level on Friday, extending gains after Japan’s central bank lifted interest rates to their highest point in three decades. BTC rose around 2.5% from the daily open, according to TradingView, mirroring a broader upswing in US equity futures despite the rate hike typically being seen as a headwind for risk assets.

The Bank of Japan raised rates to roughly 0.75%, ending a prolonged period of ultra-loose monetary policy. While the move contrasted with easing trends among other major central banks, market reaction leaned unexpectedly positive. Some analysts argued that structural and political constraints could limit how far Japan is able to tighten policy going forward.

Analysts see limits to further rate hikes

Former BitMEX CEO Arthur Hayes framed the decision as ultimately constructive for asset prices, pointing to Japan’s ongoing struggle with negative real rates. “Don’t fight the BOJ: -ve real rates is the explicit policy,” Hayes wrote on X.

Research group Temple 8 Research also suggested that expectations of aggressive tightening may be misplaced. The firm highlighted tensions between market assumptions and Japan’s fiscal reality, arguing that further rate increases could sharply raise debt servicing costs tied to the country’s latest stimulus measures.

“You cannot floor the gas (Fiscal Stimulus) while slamming the brakes (Rate Hikes),” the group wrote, warning that higher rates could make interest payments unsustainable.

Bitcoin still searching for a durable bottom

Alongside the rebound of Bitcoin, US stock futures advanced, with Nasdaq 100 futures climbing and the S&P 500 attempting to recover from recent stagnation. Some market observers noted that improving sentiment and seasonal patterns could support a late-year rally in equities, which may also benefit cryptocurrency markets.

Despite the bounce, caution remains widespread. Bitcoin recently dipped as low as $84,390 following unexpected US inflation data, reinforcing concerns that volatility has not yet fully played out.

“Bitcoin is currently hammering out a bottom, but the process is far from over,” onchain analytics firm Checkonchain cautioned. The firm highlighted the $81,000 level — roughly the cost basis of US spot Bitcoin ETFs — as a critical support area and noted that the market has yet to experience what it described as a “true capitulation event.”

Sources:

https://cointelegraph.com/news/bitcoin-rebounds-japan-rate-hike-arthur-hayes-dollar-200-yen

https://www.tradingview.com/symbols/BTCUSD/?exchange=BITSTAMP

https://x.com/_checkonchain/status/2001818983759257653

https://x.com/CryptoHayes/status/2001866538316407198

https://x.com/TechCharts/status/2001744556904104079