• Bitcoin (BTC) hit a new high in yen-denominated prices on the night of the 14th, Japan time, and its price movement was different from that in US dollar-denominated prices.
• Sentiment towards the Japanese yen has worsened due to the Bank of Japan’s continued monetary easing policy and the resurgence of inflation.

Legal currencies such as the US dollar, Japanese yen, and euro are not backed by hard assets (tangible assets), and their value is subjective and depends on market perception at the time. Bitcoin’s continued rise speaks to current market perception, with the Japanese yen having the weakest sentiment among the major fiat currencies.

The spot Bitcoin price on the exchange has exceeded the ATH (All Time High) of 7,794,000 yen! https://t.co/q7W421FpGO#bF10 pic.twitter.com/6fMcWGdozC

— bitFlyer (@bitFlyer) February 14, 2024

On the night of the 14th, Bitcoin hit a record high of approximately 7.8 million yen on the Tokyo-based crypto asset (virtual currency) exchange bitFLYER. By contrast, the dollar price is around $52,000, about 30% lower than the all-time high of $69,000 hit in November 2021, according to TradingView data.

This price difference reflects the relative stress on the Japanese yen due to the Bank of Japan’s continued easing policy and the resurgence of inflation.

While central banks such as the US Federal Reserve (FRB) aggressively raised interest rates in 2022 and 2023 to curb inflation, the Bank of Japan kept interest rates at zero and continued its easing policy. .

Japan’s core inflation rate (consumer price index minus volatile food and energy) rose by 3.1% in 2023, the largest increase since 1982. Inflation weakens the purchasing power of fiat currencies and encourages investment in alternative assets that can act as a store of value, such as Bitcoin and gold.

Currently, the yen is depreciating again, reaching the 150 yen level to the dollar. Unless the Bank of Japan accelerates its withdrawal from ultra-easy monetary policy, Bitcoin may continue to trade at a premium on a Japanese yen basis.

｜Translation/Editing: CoinDesk JAPAN Editorial Department
｜Image: TradingView
｜Original text: Bitcoin-Yen Pair Hits Record High, Reflects Stress on Japan’s Fiat Currency