While some analysts are linking Bitcoin’s recent price movements to U.S. President Donald Trump’s decision to initiate ceasefire talks between Russia and Ukraine, others are pointing to deeper macroeconomic undercurrents — particularly in Asia.
André Dragosch, Head of European Research at Bitwise Asset Management, believes that the true driver of Bitcoin’s latest rally is the growing instability in Japan’s sovereign bond market.
In a recent analysis, Dragosch highlighted that the yield on Japan’s 30-year government bond surged to a record 3.185% on May 20, 2025. This development, he argues, signals rising credit risk in a country long seen as a bastion of financial stability.
“Government bonds are often considered safe haven assets,” Dragosch noted. “But when yields rise sharply, it usually signals investor concerns about fiscal sustainability and the country’s ability to repay its debts.”
Bitcoin as a Hedge Against Sovereign Risk
According to Dragosch, this surge in bond yields is pushing traditional financial institutions to reconsider their portfolio strategies. “Instability in Japan’s bond market has increased credit risk concerns and led to greater BTC adoption among TradFi participants,” he said.
Bitcoin’s appeal in this scenario is clear: it is decentralized, immutable, and carries no counterparty risk — all attributes that make it attractive in the face of sovereign debt fears. Dragosch argues that as more institutions look to hedge against sovereign defaults and fiscal mismanagement, Bitcoin will be increasingly seen as a viable long-term asset.
$200,000 Target on the Horizon?
Looking ahead, the Bitwise executive believes that if credit risks continue to mount — not just in Japan but in other major economies — Bitcoin could reach as high as $200,000 in the long term. The narrative of Bitcoin as a macro hedge, once niche, is gaining momentum across institutional circles.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/how-japanese-bond-market-turmoil-could-push-bitcoin-toward-200000/