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The Japanese yen is approaching its weakest level against the US dollar in nearly four decades, and traders are watching the 161.95 level closely.
According to reports, USD/JPY recently touched 160.80, with many analysts expecting a move toward 162. This would mark the weakest level for the yen since late 1986 and could trigger another round of intervention from Japanese authorities.
For crypto markets, the yen is important because Japan has long been a source of carry-trade liquidity. Cheap borrowing costs allow investors to borrow yen and deploy capital into higher-yield assets, including stocks and cryptocurrencies.
As long as the yen remains weak, those flows tend to support risk assets. A sharp intervention by Japan, however, could force investors to unwind positions and create volatility across markets.
$XRP Has Strong Links to Japan
Unlike many cryptocurrencies, $XRP has deep ties to Japan through SBI Holdings and SBI Ripple Asia. Japanese financial institutions have spent years exploring $XRP for cross-border payments, and recent developments have expanded that relationship.
Ripple-related infrastructure has gained support through blockchain bond initiatives, $XRP Tokyo 2026, and discussions around XRPL adoption and RLUSD integration.
Weak Yen Could Support $XRP, But Intervention Brings Risks
A weak yen supports carry trades and liquidity flows, which can indirectly benefit cryptocurrencies. $XRP could see greater influence from Asia, particularly Japan, compared with Bitcoin and Ethereum because of Ripple’s strong presence in the region.
The risk comes if Japan intervenes near the 161.95-162 area. Japan spent a record ¥11.73 trillion ($72 billion) between April and May to support the currency, but those gains have already disappeared. Analysts at IG Australia, SBI FX Trade, and JPMorgan expect another intervention if dollar-yen reaches 162.
Previous interventions caused rapid yen rallies and triggered selling across risk assets. As per Grok, similar moves could pressure crypto markets and create short-term volatility for $XRP.
Ripple’s On-Demand Liquidity service may also benefit from periods of currency stress. The system uses $XRP to provide instant liquidity without requiring banks to hold funds overseas. Rising volatility and higher Japanese interest rates could increase demand for faster payment systems.
Analysts Continue to See Long-Term Upside
$XRP trades at $1.16 at press time. On-chain data from Ali Martinez shows network activity has dropped nearly 50% over the last two weeks, with active addresses falling from 50,000 to around 25,000.
Despite weaker activity, Black Swan Capitalist founder Versan Aljarrah believes $XRP remains inside a multi-year accumulation range.
His chart shows three major corrections since 2018, with pullbacks reaching roughly 96.7%, 95.2%, and 91.2%. Higher lows have formed throughout the cycle, while a long-term support trend line continues to hold.
According to the chart, $XRP is currently trading inside an accumulation zone near support. Aljarrah argues that prolonged consolidation often leads to stronger breakouts, with his long-term projection pointing toward the $10 area.
As the yen nears the 162 level, $XRP could benefit from continued liquidity flows. However, any intervention by Japanese authorities may increase market volatility and alter the liquidity conditions supporting risk assets.
Related: $XRP Falls Below $1.20 Despite Ripple’s Africa Stablecoin Expansion