One-year ago today, markets were rattled by the unwind of the yen carry trade. As Japan shifted toward a tighter monetary policy and bond yields rose, the strategy of borrowing in a low-interest currency like the yen to buy higher-yielding assets became less attractive. At the time, capital rapidly fled risk assets. Bitcoin (BTC) fell sharply, dropping nearly 30% to $49,000, a level previously seen at the time of the U.S. spot ETF debuts in January 2024. Since then, however, the largest cryptocurrency by market cap has rebounded strongly, rallying over 130% in the past year. Traditional markets also performed well, with the S&P 500 rising 24% and gold appreciating 40%, reflecting growing demand for both risk and defensive assets. In contrast, the dollar index (DXY), a gauge of the U.S. currency against a basket of peers, has weakened to just under 100 from 103 as returns on long-dated bonds marched higher. The U.S. 10-year yield increased to 4.2% from 3.7%, while the 30-year rose to 4.8% from 4.0%. The shifts were amplified by international interest-rate moves, with the U.K.’s 30-year yield climbing to 5.3% from 4.3% and Japan’s soaring to above 3% from 1.9%. Despite the price volatility, long-term bitcoin holders have steadily increased their share of supply. According to Glassnode's HODL Waves chart, which visualizes the distribution of bitcoin supply by age, each colored band represents the percentage of BTC in existence that last moved within a specific time range. The bands collectively show how long coins have been held, offering insight into investor behavior and conviction over time. The 7-to-10-year cohort now holds over 8%, up from 4% a year ago, while 6 to 12-month holders have increased from 8% to 15%. This suggests longer-term holders remain confident and are still accumulating, while newer investors entered the market during the rally. While a greater percentage of supply is now held by sub-3-month holders than in 2024, indicating many buyers have likely entered at higher prices, possibly chasing tops rather than buying the lows.
