Japan just sold $87.8B of foreign securities in a single month, and most of it was US government debt. Japan is the biggest foreign lender America has. So why is Bitcoin up 25% over the past month, while the US' largest bond buyer was selling? Japan's Ministry of Finance spent ¥15.4T ($98.66B) buying its own currency between July 30 and August 26, the largest monthly intervention in the country's history. The yen had slid to 164 per dollar, its weakest level since 1986. Buying yen means spending dollars, and Japan's dollars sit in US Treasury bonds, roughly 70% of a $1.2T reserve pile. That meant selling the bonds to raise the cash, with Japan's reserves posting their largest monthly drop on record (down 6.18%). More sellers means lower bond prices, and lower prices mean higher yields, which is the borrowing cost for everything from your mortgage to corporate debt. That pressure was building before Japan turned up. The 30-year yield touched 5.34% in August, its highest since 2007, and as our analysts have been saying since then, the long end has simply stopped getting a bid. AI capex has companies issuing so much debt that you can hold a Google bond near 6% or a Meta bond near 7.5% instead. We've been saying since early August that Japan looked like the seller behind it, and this week's reserve data confirmed it. Then on August 19 the Treasury doubled its long-end buybacks, taking the cap from $2B to at least $4B per operation. The 30-year fell about 15 basis points within hours, and Bitcoin ripped 11% on the largest single-day short liquidation in its history. Our own John Gillen called it the most bullish catalyst for Bitcoin since the Fed started cutting, saying the US gov had admitted it can't let long-term borrowing costs float freely, and would rather step into the bond market itself. Coinbase's former Global Head of Investment Research, David Duong, is less sure, pointing out that yields drifted back towards where they started in the days after the announcement, with plenty of traders calling Bessent's bluff. Japan also said it plans to use the Fed's repo facility next time, which hands it dollars without selling bonds. However you choose to slice it, the US dollar is going to be debased one way or another, which is why many of our analysts have been in the debasement trade for a while now. Our Milk Road Daily Show host, @BitcoinJesusETH put the buy signal up on Bitcoin back when it was just $60K, and it trades near $79K today. Don't miss his next entry. Join us for $1 below.