The US and Japan coordinate on the yen for the first time since 2011 as Bitcoin traders brace for a historically rough August.
Bitcoin (BTC) starts the first full week of August circling $63,000 as traders weigh the impact of the ongoing Coldcard wallet hack.
Concerns over US Treasury markets were behind the US decision to intervene in the Japanese yen last week. Washington engaged in a rare operation to support the yen after USD/ JPY had reached almost 164 last week, per data from TradingView.
USD/JPY one-day chart. Source: Cointelegraph/TradingView
“It was the first coordinated US–Japan foreign-exchange intervention since 2011 and the first joint operation specifically supporting the yen since 1998,” crypto trading company QCP Capital noted in analysis released on Monday.
“The distinction matters. The New York Fed acted as the Treasury’s fiscal agent rather than as an independent monetary-policy decision by the Federal Reserve. The operation therefore highlights how institutions outside the FOMC can also influence currencies, liquidity and broader financial conditions.”
Speaking to mainstream media, industry insiders placed emphasis on the desire to avoid Japan selling large amounts of US Treasuries. The use of the Fed’s Foreign and International Monetary Authorities (FIMA) repo facility, which allows a handful of foreign central banks to access dollar liquidity without selling Treasuries, supports the theory.
“There is a self-preservation element here. Volatile markets driven by potentially fiscally-aggressive policies from Japan could extend to the U.S. Treasury markets, destabilizing the dollar,” Louise Loo, head of Asia economics at Oxford Economics, told CNBC.
In a post on X, Treasury Secretary Scott Bessent argued that FIMA could make further appearances going forward.
“Friday’s coordinated foreign exchange actions countered disorderly yen movements. Treasury remains attentive and in close communication with our counterparts at MOF and BOJ. We will not hesitate to participate in further joint intervention. The FIMA Repo Facility is an important backstop. We would encourage it to be upsized in the coming months,” he wrote.
Oil dives as Trump teases hope of Iran deal
US nonfarm payrolls data is the main point of interest for crypto and risk asset traders this week. Due on Thursday, the numbers will shed light on the strength of the labor market as recent US inflation prints have delivered mixed signals.
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