Why did Bitcoin fall today? The author of "Rich Dad Poor Dad" warns of a liquidity crash, while yen arbitrage unwinds globally.

Bitcoin was reported at around $88,400 on December 1, and Robert Kiyosaki, the author of “Rich Dad Poor Dad,” warned that a global financial crisis is brewing. Financial markets are facing a dual liquidity squeeze, with a shift in Japan's fiscal policy and a tightening of the U.S. financing market. The recent policy shift in Japan has forced investors to close positions in arbitrage trades, who had previously funded global venture capital using cheap yen borrowing. As these leveraged positions collapse, liquidity in equities, bonds, and digital assets has declined.

Kiyosaki Forecasts Liquidity Shock: Double Tightening Squeezes Global Markets

Why did Bitcoin fall today? The answer points to a systemic contraction of global liquidity. Robert Kiyosaki, the author of “Rich Dad Poor Dad,” has once again issued a warning, believing that a global financial crisis is brewing. Kiyosaki often views Bitcoin as a safeguard against currency devaluation, but this time, the factors putting pressure on risk assets are more mechanical than philosophical. Currency is leaking out of the existing system.

His warning comes at a time when financial markets are facing what analysts call a “double liquidity squeeze”: a shift in Japan's fiscal policy and a tightening in the U.S. financing market. The market capitalization of Bitcoin has reached 1.82 trillion dollars, with nearly 20 million Bitcoins in circulation. This asset remains the focus of macroeconomic debate, especially after Kiyosaki reignited concerns about an impending financial reset.

The first source of double liquidity tightening is Japan. The Bank of Japan has long implemented a zero interest rate and even negative interest rate policy, making the yen the cheapest borrowing currency in the world. Investors borrow yen and exchange it for dollars or other currencies to invest in higher-yielding assets, a practice known as “Yen Carry Trade.” Trillions of dollars have flowed into global stock markets, bond markets, and cryptocurrency markets through this method.

However, Japan's recent policy shift has broken this balance. With increased government spending and rising bond yields, the yen has begun to weaken, forcing investors to Close Position these arbitrage trades. When borrowing costs rise or exchange rates turn unfavorable, the risk of maintaining arbitrage trades increases dramatically, and investors must sell assets and buy back yen to repay loans. This forced Close Position has led to a sharp decline in global market Liquidity.

The second source is the tightening of the U.S. financing market. Although the Federal Reserve has paused interest rate hikes, its balance sheet reduction continues, withdrawing liquidity from the market. In addition, U.S. Treasury yields have continued to rise, increasing borrowing costs and making financing more difficult for businesses and investors. This tightening of liquidity is particularly evident in the highly leveraged cryptocurrency market.

Yen Arbitrage Trading Crash: The Trigger for Bitcoin's Decline

Why has Bitcoin dropped today? The global pressure triggered by the fluctuations in the Japanese Yen is the core reason. Japan's recent policy shift, marked by increased government spending and rising bond yields, has exacerbated the weakness of the Yen. This move has forced investors to close positions on years-long arbitrage trades that had used cheap Yen borrowing to fund global ventures. With the collapse of these leveraged positions, the liquidity of stocks, bonds, and digital assets has all decreased.

The collapse of the yen arbitrage trading has a particularly severe impact on the cryptocurrency market. The cryptocurrency market is one of the most liquidity-sensitive markets in the world, as its 24/7 trading, high leverage, and relatively small market size make it respond extremely quickly to changes in the flow of funds. When global investors are forced to close their yen arbitrage trades, they need to quickly liquidate assets to repay yen loans, and cryptocurrencies, being relatively liquid assets, often become the first targets to be sold off.

This mechanism was played out once in August 2024. At that time, the Bank of Japan unexpectedly raised interest rates, causing the yen to surge sharply, and global markets experienced violent fluctuations in just a few days. Bitcoin dropped from $70,000 to $49,000 during that event, a decline of 30%. Although it quickly rebounded afterward, this experience demonstrated the systemic importance of yen arbitrage trading to the crypto market.

For Bitcoin, this dynamic is a double-edged sword. Short-term liquidity pressures may exert downward pressure on prices, which is exactly what we have seen this week. However, in the long term, this pullback may drive investors towards decentralized assets as a hedge against financial instability risks. Kiyosaki's warning is based on this long-term logic: when the traditional financial system faces a liquidity crisis, Bitcoin, as a non-sovereign and decentralized asset, will become a safe haven.

The Dual Impact of Yen Arbitrage Trading Collapse on Bitcoin

Short-term Negative: Forced Close Position leads to selling pressure, Liquidity depletion exacerbates the decline.

Long-term Positive: The vulnerabilities of the traditional financial system are exposed, prompting investors to seek decentralized alternatives.

Technical Analysis: 81,000 Retracement Test 92,800 Resistance

(Source: Trading View)

The technical answer to why Bitcoin is down today is relatively optimistic. Despite the adverse macroeconomic factors, Bitcoin price forecasts have begun to show signs of stability. BTC has strongly rebounded from the support level of $81,028, which has been a high timeframe demand area since mid-2024. The daily chart shows a clear upward trend, with long lower shadows and strong subsequent buying pressure.

Bitcoin is currently testing the 20-day moving average at $92,800, which has turned into a resistance level after the decline in November. If Bitcoin can effectively break through this level and close above it, it will mark the first substantial structural improvement for Bitcoin in several weeks. With the Relative Strength Index (RSI) climbing from 32 to 41, momentum is strengthening, which aligns with the early recovery phase.

The rebound of the RSI from the oversold area is an important signal of technical improvement. An RSI below 30 is usually considered oversold, indicating that selling pressure has been excessively released and a rebound is imminent. Currently, the RSI has risen to 41, and although it has not yet entered the strong zone (above 50), it has already shown that buying strength is increasing. If the RSI can break through 50, it will confirm that the trend has shifted from bearish to bullish.

The chart structure suggests a round trip retest: a pullback to around $88,000, forming a higher low, and potentially further rallying to $98,279, which coincides with the 0.382 Fibonacci retracement level. After reclaiming $98,279, the price will move towards $103,574 and $108,753, at which point a larger pullback or even a complete reversal may occur. If the price breaks through $108,753, it will reverse the overall trend, with an expected push towards $115,000 in early 2026.

The most ideal scenario occurs when the daily closing price confirms above the 20-day moving average, and the lows are close to $88,000 to $89,500. If it falls below $86,000, the upward target will extend to $103,000 and $108,000. This technical structure indicates that, although there is macro pressure, the intrinsic demand for Bitcoin remains strong.

Is the liquidity crisis a catalyst needed for Bitcoin?

The long-term answer to why Bitcoin is falling today may be surprising: this pullback might be just what Bitcoin needs. Although Kiyosaki's warning has sparked panic in the short term, from another perspective, the global liquidity crisis could serve as the best proof of Bitcoin's value proposition. As the traditional financial system grapples with policy mistakes and debt crises, Bitcoin's appeal as a non-sovereign, decentralized, and fixed-supply asset will significantly increase.

Historically, Bitcoin's performance during major financial crises tends to decline first and then rise. In March 2020, when the pandemic broke out, Bitcoin plummeted from $10,000 to $3,800, but then soared to $69,000 against the backdrop of global central banks flooding the market with liquidity. This pattern may repeat in this round of yen arbitrage trading collapse: short-term liquidity pressures lead to sell-offs, but in the long run, investors will recognize the fragility of the traditional financial system and turn to Bitcoin as a store of value.

If market sentiment improves, the recovery of Bitcoin may extend to early investment opportunities, laying the groundwork for a stronger cycle in the future. Although Kiyosaki's warning is unsettling, it also reminds investors of the importance of holding decentralized assets against the backdrop of a resetting global financial system.