Recently, there is an interesting phenomenon worth following — the group of investors in Japan who manage trillions in household assets is facing a major test of asset allocation.

The background is clear: the Bank of Japan's interest rate hike has broken years of loose monetary policy, while the Federal Reserve has entered a rate-cutting phase. What does this policy reversal mean? The previously effective strategy of "borrowing yen to buy U.S. Treasuries" is now failing. To close positions and repay loans, these investors may be forced to sell their holdings of U.S. stocks and bonds, with an estimated scale reaching trillions.

The adjustment of capital flow at this level will inevitably impact the balance of global capital markets. The volatility in the stock and bond markets will intensify, putting pressure on risk assets. However, this just creates opportunities for certain assets.

What impact will the crypto market face? The logic is as follows: when the correlation between traditional financial assets increases and volatility rises, institutions and high net worth investors will seek uncorrelated assets to diversify risk. Mainstream crypto assets like Bitcoin possess this characteristic—they have a relatively low correlation with the stock and bond markets, and they are highly liquid. During phases of market structural changes, such assets may become important allocation options.

From another perspective, the adjustment of trillions of funds is long-term and large-scale. This means that the market needs time to digest and reprice. In this process, the cryptocurrency market, as the most liquid alternative asset market globally, has the opportunity to attract some funds seeking non-traditional investment channels.

What do you think of this wave of changes? Will the huge shock in traditional markets become a window for allocating crypto assets?