Crypto ( CRCW ) bulls may need to brace for some turbulence as Japan’s 20-year government bond yield surged to its highest level since 2008 in a move that has historically led to aversion from risk assets such as bitcoin (BTC).

The Japanese Government Bond (JGB) yield climbed to 2.265% last week, a level not seen since the global financial crisis, amid speculation of potential rate hikes by the Bank of Japan (BOJ) and rising inflationary pressures.

These are similar conditions to August 2024, where strength in the yen saw a global sell-off from equities to bitcoin, as CoinDesk reported at the time.

A surge in Japanese bond yields, coupled with geopolitical and economic uncertainties, is fueling concerns among traders that BTC could face a significant correction. Higher yields indicate that the Bank of Japan may raise interest rates to control inflation or manage its large public debt.

Rising yields in Japan often signal broader global economic uncertainty or tighter financial conditions. This creates a stronger yen, which can reduce the appeal of carry trades, where investors borrow in yen to invest in higher-yielding assets like BTC.

As such, traders are targeting a low of $70,000 for bitcoin in the coming weeks amid macroeconomic jitters, an ongoing tariff trade war and the general lack of market catalysts after a run-up to the U.S. presidential elections.

“We believe that the geopolitical and economic uncertainty is causing institutions to pare down their crypto holdings, and Bitcoin could very well drop to the $70-80k range in the coming weeks,” Jeff Mei, Chief Operating Officer at BTSE, said in a Telegram message to CoinDesk.

“Only when this tariff war ends and the Fed resumes cutting rates will top cryptocurrencies resume trending towards previous all-time highs,” Mei added, reflecting growing apprehension about the impact of U.S. trade policies nd the Federal Reserve’s cautious stance on interest rate cuts in 2025.

Elsewhere, Augustine Fan, Head of Insights at SignalPlus, painted a grim technical picture: “Price action has turned technically very negative, and the high realized volatility has worsened the BTC risk-adjusted profile, with few (if any) immediate positive catalysts on the horizon.”

Fan’s comments align with a CoinDesk analysis on Sunday, which noted that BTC is testing the 200-day simple moving average (SMA) and a close below it could mean a critical break in a strong support trendline.