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Japan’s newly appointed Prime Minister Sanae Takaichi announced a comprehensive economic stimulus package on Tuesday aimed at cushioning households and small businesses from rising inflation. The initiative, which includes subsidies for energy costs and grants to local governments, is intended to relieve pressure on consumers and encourage wage growth across the country.
Takaichi, Japan’s first female prime minister, revealed the measures during her first week in office, underscoring her administration’s commitment to stabilizing purchasing power amid persistent global price shocks. The economic stimulus package provides targeted subsidies for electricity and gas charges, alongside incentives for small and medium-sized enterprises (SMEs) to raise wages and improve worker conditions.
However, the announcement sparked wider debate within financial and crypto circles about its potential macroeconomic effects. Some analysts believe Japan’s renewed economic stimulus efforts could pave the way for looser monetary policy which is a move that may influence global markets and drive more capital into Bitcoin (BTC) and other digital assets.
Among the first to react was Arthur Hayes, co-founder of crypto exchange BitMEX, who interpreted Japan’s economic stimulus plan as a signal for renewed liquidity injection by the Bank of Japan (BOJ).
“Translation: let’s print money to hand out to folks to help with food and energy costs,” — Arthur Hayes, BitMEX co-founder, wrote in an X post on Tuesday. Hayes suggested that this policy direction could push Bitcoin’s price to $1 million, driven by global fiat currency debasement.
The Japanese yen weakened to a one-week low following the announcement, reflecting investor uncertainty over Takaichi’s pro-stimulus stance. According to Reuters, traders viewed her policy direction as a mixed signal ahead of the BOJ’s upcoming interest rate decision.
Economists have long warned that excessive economic stimulus could lead to renewed inflationary pressures, forcing central banks to balance growth support with price stability. Japan’s challenge is to support households without reigniting inflationary momentum, — Mika Tanaka, senior economist at Nomura Research Institute, told Reuters.
The timing of Takaichi’s economic stimulus announcement adds complexity to the BOJ’s ongoing monetary strategy. The central bank’s next policy meeting, scheduled for October 29, is expected to address whether to maintain its quantitative tightening stance or begin easing measures in 2026.
The BOJ is currently withdrawing liquidity from the system to control inflation but has yet to commit to returning to quantitative easing (QE) as the process of buying government bonds to inject money into the economy. Hayes has previously argued that Japan’s eventual pivot toward QE could serve as a “major catalyst” for risk assets, particularly Bitcoin.
“Once Japan restarts bond buying, global liquidity will surge again, and Bitcoin will likely be one of the main beneficiaries,” — Arthur Hayes, BitMEX co-founder, said in a prior blog post.
Market observers note that Takaichi’s economic stimulus agenda could pressure the central bank to reconsider its tightening trajectory, especially as 80% of major global central banks are already implementing QE programs, according to data from Milk Road Macro.
While Japan’s economic stimulus moves dominate macroeconomic discussions, cryptocurrency markets are already responding. Following Bitcoin’s dip to a four-month low of $104,000 last Friday, large investors known as “whales” have started rebuilding long positions, signaling renewed confidence in the asset.
Blockchain analytics firm Lookonchain reported that several whale wallets recently reentered the market. One address, “0x3fce”, increased its Bitcoin long position to $49.7 million, while another, “0x89AB”, opened a 6x leveraged long position worth $14 million. These moves suggest growing speculation that expansionary fiscal and monetary policies, such as Japan’s new economic stimulus, could reignite a global crypto rally.
The correlation between fiscal stimulus and Bitcoin price growth is becoming more apparent, — Daniel Kwok, senior strategist at Chainalysis, said in an interview. When central banks print more money, investors tend to seek deflationary assets like Bitcoin.
The ripple effects of Japan’s economic stimulus program extend beyond its borders. As one of the world’s largest economies, Japan’s fiscal decisions can influence currency markets, global liquidity, and investment flows. A shift toward more aggressive stimulus could prompt similar moves from other developed nations facing economic stagnation.
For crypto investors, the policy direction reinforces a broader narrative that continued monetary easing worldwide will favor decentralized assets over fiat-based stores of value. Takaichi’s economic stimulus plan, therefore, may not only define her domestic legacy but also shape global sentiment toward inflation hedges like Bitcoin.
