Bitcoin climbed back above $80,000 as a weakening US dollar met a suspected Bank of Japan intervention in the yen, while a dovish signal from Fed Governor Christopher Waller added further support. Spot bitcoin ETFs also swung back into net inflows after the prior session's outflow.
Bitcoin rallied 5% during US trading hours to reach $81,000, near the highs seen during last month's surprise upside move, as a suspected Bank of Japan intervention in the yen weakened the US dollar. The rally also coincided with Fed Governor Christopher Waller signaling he may back a rate hold at the Fed's mid-September meeting, which pulled hike odds lower after a hawkish Jackson Hole speech from Chair Kevin Warsh had put a September increase back in play.
Yen intervention pressures the dollar
The Japanese yen kept strengthening in the suspected intervention, pushing USD/JPY down to 155.4 after the pair had already dropped to 158.5 on Wednesday. That slide dragged the US Dollar Index down to 99, and a weaker dollar index has historically supported Bitcoin.
Analysts remain split on what the intervention means next. The Macro Paper wrote on X that "BOJ is most likely expected to hike rates this month", drawing a parallel to Q3 2024, when the Bank of Japan intervened and hiked rates together. Meanwhile, Polymarket odds for a BOJ rate hold collapsed from 12% to 1%, leaving traders pricing a 98% probability of a 25-basis-point hike at the September 18 meeting.
Fed comments and ETF flows add support
Waller said he would support holding rates in September as long as next week's August inflation print keeps trending in the right direction, even though inflation remains above the Fed's 2% target. U.S. spot bitcoin ETFs posted $101 million in net inflows on Wednesday, led by BlackRock's IBIT, reversing a $236 million outflow from the prior session.
Shares of Michael Saylor's Strategy also rose 8.6% on Wednesday, up 70% from their late-June lows but still down roughly 10% year-to-date.
Sources: Cointelegraph.com News, Bankless News, Research and Analysis
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