Recently, there is an interesting phenomenon - the "Whales" that truly influence global capital flows may have never been on Wall Street, but rather hidden in the countless households in Japan.

The strategy that these Japanese retail investors (especially housewives) have been using for decades is now changing. Their logic is simple: borrow yen from the bank, with interest rates nearly at zero → convert to dollars → buy US stocks and bonds to earn the interest rate differential and capital appreciation. This method has been quite profitable until recently when it hit a snag.

Where is the problem? The Federal Reserve is cutting interest rates, while the Bank of Japan is raising rates for the first time in over twenty years. The interest rate differential has suddenly disappeared, and this "easy profit" strategy has become ineffective.

What will happen next? They have to repay their yen loans. The worst-case scenario is that these long-term holders start to collectively sell off US stocks and bonds to exchange for yen. We're talking about a capital reversal on a trillion-dollar scale, which is enough to make the market feel it. Imagine the ripples that could reach Wall Street if the "housewife investment army" in a Tokyo living room turns around.

What does this mean for cryptocurrency? To be honest, the impact is two-way:

In the short term, if risk assets like U.S. stocks start to decline, it is unlikely that the crypto market can remain stable on its own. The downward trend may transmit across markets. However, in the long term, the situation may reverse — when a large amount of capital exits traditional financial markets, it has to go somewhere. Cryptocurrencies, as a "sovereignty-defying" and "hard-to-censor" alternative, may attract funds seeking a new habitat. This is not just a simple sell-off, but more like a global capital migration.

So what do you think? Will this reversal of capital flow first impact the US stock market, or will it trigger stronger demand for safe-haven assets, thereby pushing some funds towards non-traditional assets like cryptocurrency?