Many people cheer when they see Tokyo CPI drop from 2.8% to 2.3%, but this logic happens to be a trap.

What is the real situation? The Bank of Japan's target is set at 2%. Currently, the data still hovers at 2.3%, still above the target. Don't be fooled by the word "decrease"—this is not good news; on the contrary, it indicates that inflation has not been truly defeated. The Bank of Japan already has a reason to tighten monetary policy.

What does this mean for the crypto market?

In the past few years, yen arbitrage trading has been an important source of global liquidity. Banks can lend yen cheaply, and investors borrow to invest everywhere—including in crypto assets. Once the Bank of Japan begins a rate hike cycle, the cost of these yen funds will rise, and massive arbitrage positions will accelerate their unwind and flow back. Imagine when this tide of funds turns, the relatively niche crypto market will feel the pull first.

What should retail investors do now?

First, don't rush to buy in. Whenever macro data is released, the market loves to create a narrative of "good news." But the true direction comes from the pace of central bank policies, not the monthly data fluctuations.

Second, maintain cash reserves. This is not conservatism; it's survival. Those who can last longer are more likely to seize opportunities when they come.

Third, pay attention to on-chain movements. The true intentions of big players won't deceive you—tracking whale wallet flows can sometimes be more valuable than candlestick charts.

Head assets like $ETH may face short-term selling pressure, but in the long run, everything still depends on the fundamentals and the game of policy cycles.