Why Japan Can Gain Significantly From Bitcoin

Jeff Park, Head of Alpha Strategies at Bitwise, which operates the fourth-largest spot Bitcoin ETF in the US with assets under management totaling $2

Bitcoin price has been rallying over the past week, fueled by anticipation of a new ETF approval and easing inflation concerns. Now, as the dust settles and BTC price consolidates around $54,000, one analysis argues that the world’s largest cryptocurrency could be poised for a bullish pivot, thanks in part to Japan.

Related: Bitcoin Price Analysis for March 2023: Key Levels to Watch as BTC Price Recovers

Bitcoin price ties into historical economic decisionsHighlighting the significance of Bitcoin within the context of global economics, Jeff Park, Head of Alpha Strategies at Bitwise, which operates the fourth-largest spot Bitcoin ETF in the United States with assets under management (AUM) totaling $2,039 billion, recently presented a bullish outlook on Bitcoin via Yahoo Finance X.

In his analysis, Park contrasts the 2024 economic downturn with the crises of 2008 and 2020. While previous downturns had clear culprits or were due to extraordinary circumstances, the current situation involves complex international dynamics, primarily influenced by Japan’s economic policies.

“This current spiral of 2024 is seemingly led by Japan, which from the US perspective requires an international cooperation context in addition to its own domestic economic desires,” he noted.

Delving deeper into the historical backdrop, Park highlighted the Plaza Accord of 1985, a crucial yet often overlooked event that reshaped global economic leadership by devaluing the dollar to curb Japan’s economic ascent.

“Contrary to popular Western myth, Japan didn’t mysteriously enter into ‘the lost decades’ of stagnation by itself randomly,” said the researcher.

Describing the accord as a strategic move by the United States to maintain economic dominance, he asserted that the accord led to Japan's long-term economic stagnation and initiated the so-called Carry Trade.

Criticizing the Federal Reserve's approach, Park emphasized that it is not solely focused on domestic objectives like unemployment and price stability but is also deeply intertwined with global economic conditions.

“The US cannot just cut rates on their own without offending the rest of the world. It has real ripple effects to a country like Japan,” he argued.

Continuing his critique of the modern financial architecture, the researcher asserted that it has been characterized by decades of “artificial suppression and stealing,” particularly from Japan and the asset-poor younger generations.

“This is about the very core of the modern financial architecture, with thirty years of pent-up artificial suppression and stealing—from the youth, from the asset-poor, and I’m going to make the case here—from Japan,” he stated.

Bitcoin price stands to benefit from financial inclusionAmid these criticisms, Park championed Bitcoin as a pivotal tool for financial inclusion, highlighting that while discussions often focus on emerging markets like Argentina and India, developed countries like Japan stand to gain significantly from Bitcoin.

According to Park, Bitcoin provides a unique opportunity for Japan to decouple its monetary policy from the influence of the United States dollar, addressing its structural leadership and demographic challenges.

Concluding his analysis, Park shared his long-term bullish stance on Bitcoin, predicting a significant revaluation in the wake of the current financial crisis, adding:

“Not today, and likely not tomorrow, but still much sooner than I expected in my own lifetime. This financial crisis is the mother crisis, the original sin – and it’s global, generational, geopolitical. Even without a global implosion, the narrative will be out and people will wake up to why BTC is valuable. Once the selling pressure ends, out of the ashes will emerge the most glorious phoenix the modern financial world has ever known—and rise, rise, rise we will.”

At press time, BTC price trades at $55,066.