10th February 2026 > > Leverage (boo!), FT (boo!), Japan (hurrah!)
- Mark Timmis
- 1 day ago
- 3 min read
tl;dr
I am losing patience with the leveraged players. The FT shows its colours once more. Japan leads the way.
Market Snap
Market Wrap
Two consecutive days of inflows to the spot BTC ETFs totalling just over $500mm is a positive sign. I still think regardless of any macro events that there is a material risk of a further sell-off which will briefly touch $50k at which point we will see the final capitulation from the weak hands, and a very strong buying response for those with a long-term view. This outlook is reinforced by the developing consensus amongst the crypto investing population that the sell-off is finished and that $60k marked this cycle’s low. When almost everyone agrees on a market view, it tends to be wrong.
Curious Cryptos’ Commentary – Leverage sucks
The large underperformance of BTC vs other tech assets in the last week might have been fuelled by a leveraged hedge fund blowing up in Hong Kong:
I wish these people would stay out of our business.
Curious Cryptos’ Commentary – Hahahahahahahahahahaha
The FT has a visceral hatred of cryptos, for its editorial team love nothing more than paying homage at the altar of the technocratic elite, whose brief sojourn in the sun at our collective expense will soon be over, crushed by the blockchain revolution. And not a day too soon.
Curious Cryptos’ Commentary – Japan
Japan’s financial woes are well-documented with an extraordinary debt-GDP ratio of around 250% according to the IMF and an annual deficit of 5%. For many decades Japan practised a form of QE that kept 10-year JGB yields as low as a basis point or two, countered with sterilisation that withdrew that same liquidity by increasing the reserves banks had to keep at the central bank. A pointless merry-go-round of cash which had the huge disadvantage of removing price discovery from the bond markets and consequently the stock market too. I remember clearly maybe ten years or so ago, there were days when not one single trade in the 10-year JGB was reported by any of the authorised dealers. That is not a sign of a healthy capital market.
With 10-year yields now at 2.3% causing a drop of approximately 20% in the cash price of the 10-year (and you believe the fallacy that government bonds are risk-free?) many banks and other financial institutions are sitting on large unrealised losses that hamper their ability to do other business. With an ageing demographic, and no desire to accept immigration on the scale of other countries, Japan’s future looks bleak.
Except in one regard.
…
After calling a snap election – for which she had been advised to desist by some – Sanae Takaichi, leader of Japan's ruling Liberal Democrat Party, secured Japan’s largest post-war victory with a dominant majority of seats in the Lower House.
Why does this matter? Sanae is very much a pro-crypto leader.
Capital gains tax on cryptos is currently at up to 55%, which Sanae promises to slash to 20%, with amendments to the loss carry-forward rules to bring them into line with those for stocks making them more accommodating than now. There will be changes allowing major (however that is defined) cryptos to be reclassified as financial products bringing them into the mainstream regulatory system, opening the doors for wholesale institutional adoption of at least BTC and ETH, with perhaps a handful of others. The launch of spot crypto ETFs is slated for 2028.
The sceptics will tell me these are all just promises, and that the bureaucratic wheels turn so slowly, probably deliberately so, that I am over-egging this news. However, the LDP now has a supermajority, its agenda can be implemented swiftly however much the opposition – who naturally are naysayers – may protest.
Just one more step on the long road to the wholesale adoption of cryptos by the TradFi investment industry.