Tatsuo Yamasaki says yen fair value at 120-130 JPY, far from 150. A stronger yen would squeeze the carry trade that funds risk assets like Bitcoin. Traders watch for intervention.
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Tatsuo Yamasaki, Japan's former Vice Finance Minister for International Affairs, said the yen is roughly 20% cheaper than it should be. He pegs fair value for dollar-yen around 120-130. The pair traded near 150 in early 2026. For anyone holding Bitcoin or other risk assets, that gap matters.
The yen carry trade is a large funding mechanism in global markets. Investors borrow yen at Japan's low rates, convert to dollars or other currencies, and put that capital into risk assets. Total exposure runs into the trillions of dollars, traders estimate. A stronger yen would squeeze those positions.
Bitcoin has shown sensitivity to yen moves. When the Bank of Japan surprised markets with a rate hike in August 2024, the yen strengthened sharply. Bitcoin sold off in one of its steepest single-day drops that year. Carry trade unwinding was a factor, traders said at the time. CME Bitcoin futures activity has tracked yen positioning, traders said.
Yamasaki's warnings carry weight. His commentary preceded Japan's September 2022 currency intervention, when the Ministry of Finance bought yen for the first time since 1998. In April 2024, he warned that Japan would step in if the yen fell past 152. It did, and Japan intervened.
The BOJ is projected to raise rates to 1% by mid-2026, the highest since 1995. Higher rates would make borrowing yen more expensive. Combined with a stronger currency, carry traders would face pressure from both sides.
Yamasaki said he expects the yen to continue strengthening, especially with fiscal policy becoming clearer under Economic Security Minister Sanae Takaichi. A former official publicly calling the yen 20% too cheap raises the odds of intervention. For crypto markets, the carry trade that quietly funds risk assets is under threat.
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