Japan's ruling coalition secured a two-thirds majority in the Lower House on February 8, granting Prime Minister Sanae Takaichi a decisive victory. This political shift has boosted Japanese equities, with the Nikkei reaching new highs, but has exerted short-term pressure on Bitcoin (BTC) due to tighter global liquidity and shifting capital flows.
Market analysts note that the "Takaichi Trade" involves a reallocation of assets, with Japanese Government Bonds attracting capital amid fiscal expansion. This has coincided with a decline in U.S. equities, impacting Bitcoin, which often moves in tandem with these markets. BTC is currently trading below $71,000, down over 6% in the past week.
Despite the immediate market pressures, Takaichi's administration, with its strong majority, is expected to pursue legislative changes that could benefit the crypto sector in the long term. Analysts anticipate discussions on crypto tax reform and stablecoin regulations, potentially supporting institutional crypto adoption in Japan.
Japan's Election Victory for Takaichi Impacts Bitcoin and Markets
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