The crypto market was bloodied in the early morning, with the total liquidation amount exceeding 10.3 billion yuan within 24 hours. The trigger for this crash was unexpected — it was neither a sudden regulatory policy nor hawkish statements from the Fed, but rather a seemingly insignificant piece of news from the Central Bank of Japan.

At 7:15 this morning, the Nikkei News disclosed significant information: the Bank of Japan may announce the end of the negative interest rate era at the policy meeting on March 19. The moment the news broke, the market reacted extremely fiercely:

The Japanese yen soared 100 basis points against the US dollar in a short period of time.
Bitcoin plummeted by $3000 in the 15-minute candlestick.
The decline of altcoins generally exceeds 50%.
A large number of high-leverage positions were forcefully liquidated.

Many people do not understand the relationship between the Bank of Japan and the crypto market. In fact, for the past decade, the zero interest rate yen has been a "financing tool" for global speculative capital—traders borrow yen at extremely low costs, exchange it for dollars, and then invest in high-yield assets like Bitcoin and US stocks. This "yen arbitrage trading" is massive, and once the Bank of Japan shifts to raising interest rates, it means:

The world's cheapest financing channel is about to close.
Arbitrage positions worth hundreds of billions are facing liquidation pressure.
High-risk assets have lost important liquidity support.

Worse still, this decline has been compounded by multiple bearish factors. The Fed's interest rate cut expectations have been significantly revised down from 6 times at the beginning of the year to 3 times, while the inflow of funds into Bitcoin ETFs has shown signs of slowing for three consecutive days. The overall leverage in the crypto market had previously climbed to historical highs. Under the resonance of multiple risks, the market's vulnerability has been thoroughly exposed.

The market is currently observing two things: Will the US pressure Japan to delay interest rate hikes? Will Wall Street step in to save the market? However, given the current situation, it seems that Wall Street institutions are also reducing their positions to avoid risk, making it unrealistic to rely on external support.

If your position has not been liquidated yet, it is recommended to immediately do three things:

Reduce the leverage multiplier to within 3 times.
The spot position ratio is controlled to be below 50% of the total funds.
Closely monitor the Bank of Japan's policy meeting on March 19.

The "deleveraging wave" triggered by the closing of yen arbitrage trades may have just begun. Historical experience tells us that the true market bottom often appears when sentiment is at its most desperate. How much ammunition do you still have in reserve? How long do you think this round of adjustment will last?