Latest crypto crash isn’t due to geopolitics, but rather Japan bond Shock, says Dan of Coin Bureau. Dan, who runs Coin Bureau’s markets channel, says Bitcoin and Ethereum sharp drop wasn’t due to political drama in Greenland or Europe. The real reason is Japanese government bonds.
He explained in a new video that the crypto drop began when Asian markets opened, not due to tensions between the U.S. and Europe. This timing suggests the real reason is the spike in Japanese bond yields and tensions there, not the drama of trade talks between Washington and Brussels.
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The Real Trigger: Japanese Yields Accompanied With Global Liquidity Squeeze
Dan noted that Japan bond Shock government bond yields rose significantly over the past day, and U.S. Treasury yields also rose in tandem.
“When bond yields around the world start rising, it means loans are getting more expensive. This means liquidity is decreasing,” he says. He argues that crypto weakness is actually a result of tightening global funding conditions, not just a crypto issue.
He links this move to Tokyo politics. A snap election could occur, which officially appears to be a power play, but in Dan view, this is a way to buy time: Japan has yet to pass its 2026 spending budget.
Dan warns that if a major budget announcement comes, and yields are already rising and the yen is weak, yields could go up further, the yen could go down further, the dollar could rise, and liquidity could be drawn out of risk assets around the world.
Policy dilemma is simple:
Sell U.S. assets to support the yen and have a direct impact on American markets, or let the yen slide and tighten financial conditions, pushing the dollar higher.
Bitcoin & Ethereum Price Charts Under Pressure, But Not Necessarily Broken
On the technical side, Dan noted that Bitcoin has fallen to the daily Bollinger Band moving average, but is still making overall higher lows, indicating an uptrend.
He says many traders are expecting Bitcoin to drop below $90,000, close the CME futures gap around $88,000, and complete a bottoming pattern that has been in place since November. This is “possible,” but Dan doesn’t yet see strong evidence that this will necessarily happen.
In the near term, they say Bitcoin could bounce slightly to $95,000, with a further decline expected later in the week when U.S. markets fully open after the holiday.
Ethereum is following a similar pattern, with the daily Bollinger Band at the midline. A short-term rebound to $3,300 is possible, and traders are watching to see if the price will later fill its CME gap by dropping below $3,000. Dan is a little skeptical that the impact of New Year Day CME gaps will not be the same as standard weekend gaps, as the base trade dynamics are different.
Why February Matters More Than Today Dip
In addition to immediate volatility, Dan noted that liquidity injections from the U.S. Federal Reserve and Treasury in late 2024 are having a slightly delayed effect. He says these flows will hit risk assets with a delay of about three months, and crypto will find support until February.
He also says that U.S. tax refunds are now higher an average of $1,000 per person extra which acts as a small stimulus and could slightly boost retail buying power.
Bigger risk, in Dan view, is not this week move, but the escalation of the Japan bond Shock driven bond story in February or March. If yields and yen weakness become too extreme despite policy interventions, the risk could be greater.
His base case for now is this:
Short-term choppiness, an attempt to bounce back from current support, policymakers active in controlling bond markets, and a serious test of global liquidity in late Q1.
Message for crypto investors is simple:
focus more on JGBs, yen, and cross-market yields than on Greenland headlines. Crypto is essentially riding the same liquidity tide as all other assets.
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People Also Ask – Japan bond Shock:
Dan says, is the crypto crash over now?
Not really. He says there could be a slight bounce in the short term, but if Japanese and U.S. bond yields continue to rise, there’s a risk of renewed pressure.
How low can Bitcoin go, according to his analysis?
Dan says a drop to around $88,000 where the CME gap is located—could be a near-term “worst case scenario,” but there’s no guarantee the gap will be filled.
What is his view on Ethereum’s downside?
Traders are looking for a drop below $3,000 to close the CME gap. Dan isn’t convinced that New Year CME gaps will necessarily fill; his primary focus is on whether the current support level will hold.
Is this financial advice?
No. Dan clearly states that the video is his personal market analysis, not investment advice.
