US Treasury Secretary Scott Bessent met with Japanese Finance Minister Satsuki Katayama in Tokyo on May 12 to reaffirm what both sides described as “constant and robust” communication on foreign exchange matters.
What happened in Tokyo
Bessent’s Tokyo stop is part of a broader Asia tour that also includes anticipated discussions in China. The meeting with Katayama was focused squarely on foreign exchange coordination, as the yen has depreciated sharply against the dollar in recent months.
Japan is suspected of conducting roughly $60B in yen-buying interventions in late April 2026 alone, as the currency slid to around 155 per dollar. Since September 2025, joint US-Japan statements have explicitly permitted interventions against “excessive” market swings, meaning Japan can step in to prop up the yen without Washington labeling the moves as currency manipulation.
Since 2022, Japan’s cumulative interventions have surpassed $100B. In the immediate aftermath of the meeting, the USD/JPY rate fell 0.8% to 152.3.
The carry trade connection
Japan’s ultra-low interest rates have made the yen a favorite funding currency for carry trades. Investors borrow cheaply in yen, convert to dollars or other higher-yielding currencies, and park the money in assets that generate better returns. Those assets have, at various points, included Bitcoin and other risk-on positions. When yen volatility spikes, or when Japan intervenes aggressively to strengthen its currency, those trades can unwind fast, sometimes triggering sell-offs in exactly the assets that benefited from the cheap borrowing.
What this means for crypto investors
Bitcoin remained stable above $95,000 following the Tokyo meeting. Analysts noted that reduced forex volatility could redirect capital away from risk assets like Bitcoin and back into traditional bonds: if the currency environment becomes calmer, boring becomes attractive again.
Bessent’s Asia tour includes anticipated discussions with Chinese officials. China’s forex posture has historically had a direct impact on crypto flows, particularly through capital controls that push Chinese investors toward alternative stores of value.
If Japan’s interventions prove insufficient and the yen slides back toward 155 or beyond, the unwind risk returns, bringing cross-asset turbulence that tends to whipsaw Bitcoin in both directions.
