Did Japan Spark the Bitcoin Selloff? | Macro Mondays: December 1, 2025

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2:14Hello all there. Welcome to another edition of Macro Mondays. My name is Mikliel Rosenwald and we're sending to you live here from Copenhagen. I'm your usual host and I'm joined as usual by my good friend Andreas. Welcome to the show, Andreas. Hi, Michael. It's good to see you. Yeah, likewise. Andreas, lots of good stuff today on the show. We're wrapping up from Black Friday. We have some numbers, not from the Real Vision Black Friday. It seems to have gone well, but hopefully. But on the market from Black Friday, we're going to look towards Japan. And we're going to look a little bit at Venezuela as well.

2:47And then a couple of listener questions. And you can still, there's still time for you to get in with your question. If you're watching, whether you're watching on X, YouTube or at Real Vision, we are sending this live, so please post your questions and we'll try and bring them along. We've got another really packed week ahead of us here in Real Vision. On Wednesday, we have Ash Bennington hosting Kyle Wrighthead. He's the co-owner of Milk Road and co-founder of Impact3. We have Sanjago Velez hosting Brent Johnson. Very interesting talk on stablecoins there. And on Thursday at 11, Andreas, you're hosting Michael Howell for an extremely interesting talk.

3:23That's been really requested a lot. And finally, for all our free members, also on YouTube and Twitter, we are expanding the coverage a little bit or the content that you get. We have the, on Wednesday at 1, we have the Trading the Market show with Chris Bullock and Bijan. And on Friday, we have Wrecked Vision with Mando hosting Ejaz. So also a lot of free stuff out there for those of you who haven't signed up. If you want access to Andreas' talk with Michael Howell, if you want access to our full package of research, Real Vision, there's still time to get in on the Black Friday deals. I was told it's apparently Cyber Monday.

3:59That's still happening. So there's still time to get in on some very, very nice deals there. If you want our, Andreas and my, full access to our content, you'll have to look for the approach here and there. But lots of other good options to join the Real Vision community that's really building, especially on the new platform. So lots of good stuff to look out for in there. Andreas, maybe before we get started, we should just do our usual disclaimer here that especially in these times, we try to be as actionable and direct as possible in our research and also in this free content. But remember that our trade ideas might be...

4:35Sometimes it may be good, sometimes it may be shit. There we go. The same goes for his national team, I suppose. But that's for another day. Okay, Andreas, let's get the first chart of the week here up on the screen, because I thought we had quite a good week last week. The mood was getting better, good vibes. I was feeling good. And then I woke up this morning, European time, to punch in the stomach the demon candle, as it's been labeled. Over a course of three hours, Bitcoin lost$5 ,000 of value. Do we even know what happened? I guess at least the sell-off coincided with the governor of Bank of Japan, Weida, starting to talk about the December rate hike.

5:23more clearly than what he's done lately. And, you know, someone texted me on X saying to me, well, it just seems like Bitcoin is correlated to everything that goes down, as dollar yen did this morning, right? The yen strengthened versus the dollar. But I still think it was a likely trigger, this Bank of Japan rhetoric on a firm rate hike here in December. And why could it matter at such a timing? Well, I've said this over and over and over. When you have a 24-7 market, you spread out liquidity over a larger number of hours. That's quite simple, simply what happens, right? In sharp contrast to, for example, the equity market, you concentrate the liquidity on a shorter range of hours.

6:12So when you run leverage in, for example, Bitcoin, Ethereum or other related assets, you also run the risk of market news appearing during an hour with exceptionally low liquidity relative to peak hours. Or at least if you had fewer open hours, you would have much more liquidity to absorb those market news. So my point here is that this is something you have to accept as a feature, not a buck of a 24-7 market. That's also why the hit to these markets is substantially larger than the hit to, for example, Nasdaq, even though the futures were open. But we obviously sold the spillovers to other risk assets, but not nearly to the same extent as we did in Bitcoin and crypto space.

7:08And I think it is due to excess leverage paired with this 24-7 market open hours. And yeah, there are pros and cons of having a shop that is open throughout the day in that sense. Be careful with the leverage of their kits. That's one of our catchphrases as well. It could be. Okay, Andreas, before we get back to the Japan story, which you're also posting a very, very interesting article on the ProTure today. I think it's just out now. or should be after the show, I just want to give you perhaps the laugh of the week, or maybe this is actually serious. I found this. We've been talking a lot about data centers and trying to figure out the best bets on how to create some value for this.

7:56A guy on X or a company did an analysis on all the parameters, all the work you need to do to keep a data center running, and they... concluded that the best bet is the cleaning staff. The cleaning companies is the big winners of the data center bets. Power, chips, cooling, all that, forget about it. It's all about cleaning. It's the biggest revenue. It has a very nice revenue growth, and it's really, really cheaply evaluated, perhaps because it's such an unsexy investment. So there you go, Andreas. I don't know if we can find any cleaning companies that specialize in data centers, but the guys with the brooms, that's the way to go.

8:35I thought this was a really, really funny little exercise people did here. Do you have any thoughts on cleaning in data centers? No. I mean, my impression is that you don't have a lot of people running around in data centers unless they close down as the CME data center on Friday, right? So why do you need cleaning all the day? I mean… Generate some dust perhaps? I don't know. I don't know. I don't know. Just a fun little bit here. Andres, we'll get back to some of the hot takes we've also brought in, so some more laughs for a little bit later. But I just want to zoom back to the Japan story. So perhaps one of the reasons we saw this big sell-off yesterday or this morning, Asian time, was the announcement or the indications that we're going to see a rate hike from the Bank of Japan.

9:28You wrote a lengthy piece. Could you just give us a quick intro to it and what you're seeing happening in Japan? Why are they so eager to hike the rates out there? Well, we still have inflation pretty much entrenched in the Japanese system, especially everything related to wages. We have inflation, you know, roughly beneath the hood running around two and a half to three percent. It's actually kind of the same picture as we see in the U.S., but maybe even more entrenched in Japan. And that's such a dramatic regime shift compared to what we've been used to from Japan. It was a country where probably most people concluded that they would never get out of this spiral of no inflation, debt growing, etc.

10:13And now we're to some extent seeing the opposite. I've seen both my inbox from investment banks, but also so many macro commentary being full of a lot of pundits. Have you ever wanted to trade Bitcoin but haven't dared try? With Plus500 Futures, you can trade crypto without the hassle of opening a wallet. With just a few clicks, you can register and start practicing with their free and unlimited demo. See a trading opportunity? You'll be able to trade it in just two clicks. Feel ready? You can move to real money with as little as$100 once your account is approved. And the great thing is that in addition to crypto, Plus500 gives you access to a wide range of instruments.

10:55S &P 500, NASDAQ, gas, and much more. Explore equity indices, energy, metals, forex, and beyond. With a simple and intuitive platform, you could trade anytime, anywhere. Experience the fast, accessible futures trading you've been waiting for with Plus500. With over 20 years of experience, Plus500 is your gateway to the markets. Visit us.plus500.com to learn more. Trading in futures involves the risk of loss and is not suitable for everyone. Not all applicants will qualify. Plus500, it's trading with a plus. kind of you know comparing the current setup to what happened in 2007 2008 in japan because that was basically the last time where they you know dared hiking interest rates to any major extent we also had one year and two year interest rates around one percent in japan back at the time and that's basically roughly where we're at again so um is this a late cycle signal well i've you know Historically, I would have been tempted to say yes.

11:55I mean, Japan hiking interest rates doesn't get any more late cycle than that, right? I think the difference here is that in sharp contrast to 2007-2008, we've seen a structural change in both liquidity but also price pressures that makes it more likely that this is just a start of a trend rather than a late cycle. And to give you a few examples of why, look at, for example, Nikkei or Japanese banks in particular or Japanese construction bets. I mean, everything that has a cycle to it, we've seen the Japanese equity market performing very well alongside higher bond yields, alongside Bank of Japan, withdrawing their support for asset markets.

12:49I mean, it's in sharp contrast to what you should have expected, all else equal, before those things were about to happen, right? If I told you that 10-year bond yields are now roughly 2 % in Japan, and Bank of Japan is buying maybe a quarter of what they did at the peak a month, would you guess that Nikkei would have been, I don't know, 100 % higher than it was before they started this process? So I think something has structurally changed. And remember, remember this, as an equity investor, you should actually salute inflation. Because what does inflation tell you? It tells you that companies can actually raise prices.

13:29And I think the sweet spot is basically somewhere in between 1 % and 4 % inflation for investors. If you have more than 4 % inflation, you start to see very weak equity markets. But if you have below 1 % inflation, you also see weak equity markets. Remember that. So by the end of the day, having brought inflation back in Japan, and now we're seeing that entrenched inflation, I actually think that's good. it's at least very much better than an inflation environment of say 0 % to 0.5 % inflation per year. So all in all, I think there's a regime shift happening in Japan. It's not just a cyclical shift.

14:10Those of you who remember the summer of 2024 also remember how the turning time and the dollar versus the Japanese yen turned into something that was a big scare for everything from Nasdaq to crypto market. I think the big difference to a little bit more than a year ago is that this carry trade in the dollar versus the yen is not particularly participated in by the levered fund space. So we had a three standard deviation long in dollar-yen in the late summer of 2024, while the positioning is roughly flat now, which is a big change to a year ago. So, you know, those players that will turn the book very fast if we see a sudden shock to the dollar-yen exchange rate, they're not as active in this market as they were a year ago.

15:02They learned their lesson there to some extent. Of course, there's a more structural element to the carry trade, not least that you see Japanese life and pension funds buying fixed income around the globe, or at least they did. And of course, if bond yields, they turn much higher in Japan, especially if the curve steepens in Japan, they'll be more inclined to buy local bonds than global bonds. And I think we're on the precipice of a move that is sufficient to bring about some spillovers to the U.S. Treasury space. We've already seen that today, but it very much depends on the steepness of the curve, because you remember that, you know, the spread between bond yields in Japan and the U.S., you'll have to adjust that for the running cost of hedging your FX exposure if you're a Japanese life pension fund.

15:57And therefore, it is the relative steepness between, for example, 10-year and three-month interest rates that matter. and if I'm right that the Federal Reserve will cut here in December and cut a couple of times more already during the first quarter of next year, there's nothing to worry about because that will steepen the dollar curve more than the Japanese equivalent, meaning that the Japanese life and pension funds can continue buying treasuries. But we're on the precipice of something here unless the Federal Reserve cuts interest rates more. So a quick break in your regular programming. If you're serious about your future, grab my free report called Prepare for 2030.

16:33I think you've got five years to make as much money as possible, and this guide will help you navigate what's coming. The link is in the description. Download it now. Interesting. So just to sum up also, to link it to what happened last night or this morning, Asian time, it seems to me that this announcement that the Japanese, that the BOJ is looking to hike, it's not based on their wedding. It's not necessarily a new hiking season they're opening. They're committing to perhaps one hike, and then we'll see. They have a new government, new prime minister, who's probably not so fond of this. It still seems like a very, very dramatic price reaction in Bitcoin.

17:12Is that due to the squeezed liquidity that you talked about earlier? Or did it have such a harsh effect on Bitcoin? Yeah, I think it's a matter of the liquidity during those hours, but it's probably also a matter of Asian accounts taking more notice of this than, for example, European or US accounts. I think it's very early days to conclude that the time has turned on the dollar-yen trade. We'll have to see the Bank of Japan. They've hiked interest rates a few times this cycle, but they've been very careful each time. So remember that in the run-up to those meetings, we've typically seen a stronger Japanese yen.

17:57Ultimately, after the meeting, those hopes of a more hawkish central bank, they've basically vanished into thin air because they've been so careful, rhetorically, of not promising further hikes. We'll have to see what happens now that we've done a one-and-done kind of hike. And I think it's the same here. They'll do 25, either December or January, and then they'll wait a long time before doing anything again. Interesting, Andreas. Okay, let's zoom back to Friday, Andreas, to Black Friday. I don't know if this is relevant in a macro perspective, but it seems to me that comparing this Black Friday to last Black Friday is a very, very hands-on specific measurement of the economy.

18:40So the numbers that we are having so far is a rise of 4.1 % compared to last year. That's including inflation. So it's a 1 % rise, but still not worse than last year. Online spending up 9.1%. Is this a bullish indicator, bearish indicator? What do you make of this, Andreas? It has to be seen as a pretty solid sign of a consumer that is still active. If anything, I mean, it depends on whether you're a glass half full or glass half empty kind of guy. But of course, if you see a lot more discount buying, it's not necessarily the strongest signal for the consumer. I typically track on a running basis the spending in discount stores versus luxury stores.

19:31And that's typically a strong ratio signal if you see a lot more spending in discount shops. But in any case, now that we're comparing discount to discount, I consider this a sign that the retail sector is still doing okay. I would even argue that it's more than a 1 % inflation adjusted return because if you look at the goods inflation, it's still lower than services inflation and you buy more goods than services on a day like that, right? So a point in case, at least the economy is not declining. It's not when you see stuff like this happening. It's certainly not. No, no. And I mean, again, zooming back to Liberation Day to April, this was exactly what we expected, a huge collapse in Black Friday sales.

20:16And we're not seeing that. It's not emerging for a number of reasons. A little bit of a detour here, Andreas. I saw that the AI traffic to US retail websites grew 805 % on Black Friday. So this is the year where AI traffic to retail websites, directing traffic for consumers broke through. And this is now outmaneuvering search engines, etc. Just an interesting little tidbit. I'm not sure I have an investment angle on this, but very, very interesting for me that search engines are out, essentially when it comes to Black Friday and consumption. Miguel, I don't know whether I prefer anecdotal evidence or not in cases like this, but personally, I ask ChatGPT about everything.

21:09Everything from, okay, I slept poorly this night. What can I do to change that tomorrow? I ask ChatGPT for advice on the sizing of the shoes that I bought on Black Friday, for example. I ask it about everything. And, you know, if you look at various statistics in the usage, I'm certainly not the only one, right? So we still see an acceleration, especially in the retail consumption of AI agents, while we probably don't see the same, you know, acceleration in the non-retail consumption of agents right now. But I think that that's because it lags, basically. Yes, yes. And this is an entirely new channel.

21:49I know most digital marketing agencies are all over this, but if you're working in old-school search engine optimization, you might need to consider your line of work, essentially. Anyway, Andreas, one more topic before we get to some listener questions here. I wanted to bring up this tweet from Pete Hexeth, the U.S. Secretary of War. He's called now. He drew to the front of a children's book of Franklin targeting narco terrorists outside of Venezuela, supposedly. So, Andreas, I wanted to stress this, and I posted this in Real Vision, and I'll be discussing it more in length in my The Drill article this Wednesday.

22:32I think investors in the market is currently underestimating the risk or the likelihood of a U.S. strike on Venezuela. I'm building on this sort of ladder of escalation that we can have here. So essentially, the U.S. has been building up its military forces, been threatening the Maduro regime, all in an attempt to increase the pressure in the hopes that he will resign, essentially. The next step was establishing a casus belli, as it's called, a reasoning for war. You may remember back in the happy Bush days, You had Colin Powell before the UN with the vials and the satellite photos that was established in grounds of war.

23:15The next step is to actually do something. And now we have sort of the reasoning. Maduro has been labeled as a terrorist, as a drug cartel leader. You can discuss whether that's relevant, but he is. He has been designated as that. So I think there is an increased risk that we might see strikes in Venezuela even during this week. and it's, I don't know if you can position for it, but you need to watch out for it and you need to consider it. To be very specific, perhaps we've discussed sort of exiting the European defense trade. I know a lot of guys also in realisation have been in the Rheinmetall trade, et cetera.

23:53I think that's thematic is weakening as we are heading towards peace in Ukraine, but you might want to make a pit stop in some US stocks this week or next week just in case you get a US defense stocks, just in case you get an attack on Venezuela. Because I think, I mean, if you look at the face value of what Pete Hexeth and Donald Trump are telling you, they're telling you they're going to attack Venezuela. Sometimes you need to take these things at face value. Miguel, let me ask you a question about Venezuela, right? Because, you know, not that I'm saying that the run-up to this is reminiscent of the invasion of Iraq.

24:28Sorry for my pronunciation. But is this about oil? or at least it will be, you know, it will be a very important event for oil markets, right? So the question here is, is it bad or good news for the oil price? Will the oil price go lower or higher if they attack Venezuela? My best guess would be lower, but I'm interested in hearing yours. I mean, if we're talking about a, what I would expect the next step in this escalation is, it would be a drone strike or a military strike on some military installations, some drug installations or whatever. I think that would send oil prices up in the short term.

25:03But in the longer term, another bet on this is the Western companies that can swoop in if we get a new regime in Venezuela and help them reestablish their oil business. Because right now, if you cut off the Venezuelan oil supply, it's not really disrupting oil markets that much. on the other hand, as you're alluding to, if you get it up and running again, and if you begin really drilling and getting the oil production running down there, that's another massive supply flow to the markets. So absolutely, in the longer term, this could drive down oil prices even more. And that's obviously also what Trump is looking for here.

25:37This might actually be a war for oil, if anything. Also, it's very much political, of course. The US has a lot of reasons to dislike Maduro. He's a terrible guy. I'm not defending him in any way, but it's interesting. I don't think we're going to see an Iraqi-style invasion here. The U.S. has deployed around 15 ,000 troops to the region. That's not at all enough for this type of operation. You need at least 10, 20 times that. But obviously, their target is a regime change. Maybe they can force one through increased pressure. Something to note as an investor in any case. So we'll be following and expanding on that.

26:17Andreas, I want to head over to some listener questions because we've had some nice ones here. I don't know if you saw this earlier today, the announcement from Strategy around the US dollar reserve. We have a question here from Europa Crypto. Do you have any initial thoughts on this establishment of their dollar reserve? It's$1.4 billion in terms of implication for Strategy and Bitcoin. so i have a lot of thoughts on on microstrategy not only on this uh dollar reserve uh first of all you know i think it was yesterday he treated out that what if i add a green dot to this chart typically he's been tweeting about orange dots every time they bought bitcoin right it was obviously related to this right that's point number one point number two is that We've seen this updated guidance from the MSCI on how to understand digital asset treasuries in the context of MSCI indices, right?

27:19And they've basically classified that every company that holds more than 50 % of their balance in digital assets is to be considered an investment fund rather than a single stock. I think that's, you know, it was out October 10th. basically coincided with the big sell-off in Bitcoin. And I think it was related partially to that, not least since it makes it a whole lot more difficult to imagine a scenario where these digital asset treasuries trade with a premium to their underlying asset values. So I think overall, this microstrategy case looks slightly shaky. And I would personally prefer the underlying two debts in the Bitcoin space and by the way also in other crypto assets as a consequence of what happened with this MCI update to the legal states.

28:22I mean, it is bound to be implemented during February next year. Of course, still subject to change, I guess. But by the end of the day, we'll also have to see what the SAP says about it. But I think the question marks line up here. So I would much rather prefer the underlying to the debts right now. Makes sense. Okay, Josh, a listener sent me this tweet from a guy called CryptoNobler here. We sometimes like to look at the week ahead. This guy has the week essentially lined up. It's not the usual economic calendar. Maybe we can get the tweet on the screen here. Here we go. So essentially, this is this week's schedule.