The central banks of Japan and the US remain idle in sync! The crypto market's market capitalization slightly rises to 3.89 trillion, will a Bear Market come?

Question

After the Fed maintained interest rates for the fifth time, the Bank of Japan also decided to anchor its policy rate at 0.5%, and the global crypto market is holding its breath. Although the total market capitalization slightly rose by 0.76% to $3.89 trillion, BTC, ETH, and XRP all experienced a short-term sharp fall. The Bank of Japan cautiously raised its CPI forecast to 2026, hinting at a potential interest rate hike; the 4.25-4.5% interest rate range from the Fed received 9 votes in support, while 2 votes advocated for a rate cut. Analyst opinions are divided: LVRG warns that the pace of the bull run may slow down, while Apollo Capital believes that under the policy rate game the bear market is unlikely to occur. Liquidity support in the crypto market and tariff policy transmission effects are key variables.

1. The Central Bank's dovish stability: Cautious balance under inflation concerns

After a two-day meeting, the Bank of Japan decided to maintain the Interest Rate at around 0.5%, following the Fed's decision to stay put. Although the decision was unanimously passed, the core trends are worth noting:

CPI forecast extended: The Central Bank's expected time to achieve the 2% inflation target has been extended to 2026 (previously FY 2025). Tetsu Saeki, chief strategist of Fukuoka Financial Group, interprets this as a "slight upward adjustment," revealing ongoing concerns about inflation stickiness.
Path of Interest Rate Hikes Left Open: The Central Bank stated that if the economy and price trends meet expectations, it will "continue to gradually raise policy interest rates." However, Tohru Saeki pointed out: "Although the level of inflation supports a hawkish stance, the Central Bank may raise interest rates at any time, but still holds a cautious attitude towards global risks (especially U.S. tariff policy). There are fundamental differences in the understanding of the tariff agreement between the U.S. and Japan, and uncertainties in trade negotiations remain."
Risk Hedging: In response to potential U.S. tariff impacts, Japan has launched a $6.3 billion economic relief plan, which may indirectly provide a liquidity buffer for the crypto market.
Policy Orientation: The Central Bank assesses that the inflation risk is "generally balanced," acknowledges that the real interest rate (adjusted for inflation) is at a very low level, and commits to stabilizing the achievement of the inflation target with "appropriate monetary policy."

2. The Fed freezes interest rates for the fifth time, internal divisions become apparent

The Federal Open Market Committee (FOMC) of the Fed announced that it will keep the interest rate in the 4.25%-4.5% range, marking the fifth consecutive time it has held steady since the meetings in January, March, May, June, and this time.

Voting Divergence: 9 members support maintaining the Interest Rate, while 2 voted against. Directors Christopher Waller and Michelle Bowman advocate for a 25 basis point cut.
Policy Dilemma: The decision-makers seek a balance between curbing inflation and preventing economic slowdown, with the Interest Rate Deadlock continuing.

3. The crypto market is experiencing short-term fluctuations, and the divergence in the future market is intensifying

After the resolution was announced, the crypto market showed a short-term sharp fall followed by stabilization oscillating pattern:

Market Capitalization: Slightly increased by 0.76% to $3.89 trillion.
BTC: Currently priced at $118,415, previously plummeted to an intraday low of $116,000.
ETH: Influenced by the decision of the Central Bank of Japan, it once fell to $3,691 and has now rebounded to $3,860 (+1.43%).
XRP: As of the time of this report, it is $3.14, having previously hit a six-day low of $3.022.

Analysts' opinions collide fiercely:

Cautious faction (LVRG Research Director Nick Ruck): "If the Fed maintains a cautious stance, the bull run may slow down, but the bottom or support constructed by the surge in Liquidity may ultimately rebound." This suggests that the crypto market volatility will increase.
Optimists (Henrik Andersson, CIO of Apollo Capital): "The market has already priced in the expectation of no interest rate cuts, so the impact is limited... We believe this will have little substantive impact on the crypto market, and the uncertainty around tariffs and the delay in interest rate cuts has become a consensus." Emphasizing the effectiveness of policy expectation management.

Conclusion: The synchronized wait-and-see approach of the Japanese and American central banks injects a complex sentiment of caution and observation into the crypto market. The effect of negative news being fully priced in due to the clarification of policies has led to a slight increase in market capitalization, but the intraday flash drop of leading assets like BTC reveals their fragility. The future direction of the market will be deeply tied to two core variables: first, the global liquidity tap — the potential interest rate hike timing of the Bank of Japan and the Fed's interest rate cut path negotiation; second, geoeconomic risks — the impact of U.S. tariff policies on economies like Japan. Under the tripartite policy dilemma of "inflation-growth-trade," the crypto market may struggle to present a one-sided trend, and Structural Volatility will become a characteristic in this phase.