The Swiss National Bank (BNS) reduced its interest rate at 25 basic points, taking it to 0%.
This decision not only reflects a turn in the monetary policy of one of the most conservative countries of the international financial system, but also opens the door to greater growth, a phenomenon that for years was the engine of speculative capital flows worldwide: the Carry Trade.
To understand what is at stake, it is convenient to remember the role that Japanese had in past decades. With rates close to zero for years, Yen became the financing currency par excellence for global investors. They borrowed in yen, where the cost was very low, and placed those funds in assets from countries with higher rates, such as emerging economies or even in markets considered “speculative”, such as Bitcoin. Was A way to gain performance with simple rates arbitration.
That model, however, began to disarm when the Bank of Japan finally uploaded its rates in 2024, which – as cryptootics explained it at the time – more expected these loans and caused the forced closure of many speculative positions, negatively affecting the markets. In that context, many investors They looked at Switzerland as the potential scenario to carry out the Carry Trade.
In September last year, EBC Financial Group, an investment company, I commented:
«The attractiveness of the Swiss Franco has increased even more as Yen has weakened. The operations of Carry Trade in Yen collapsed in August after the currency recovered strongly due to the weak economic data of the United States and an unexpected rise in the types of the Bank of Japan ».
EBC Financial Group, investment company.
And what now It happens With Switzerland, by bringing the interest rate to 0%, in a way “welcomes” investors who want to speculate in the European country. Instead of closing a stage of cheap money, it is opening it. And it does so from a particularly sensitive place: the financial heart of Europe, in a context where the European Central Bank could also begin to make its policy more flexible in the coming months.
The loss of Swiss rates Turn the Swiss Franco into a new cheap financing currency. If the environment of low rates in Europe is generalized, it would not be unreasonable to think about the notable increase in strategies of Carry Trade With center in the Franco, like those that dominated the markets in the Yen era.
However, there are substantial differences. The weight of the Swiss Franco in the global economy does not compare with that of Yen. Switzerland is an economy relatively small And, therefore, its currency, although strong, does not have the depth or international liquidity of the Japanese Yen (at least, for now). Even so, the attractiveness of a zero rates environment in the midst of a indebted world and thirsty for performance could reactivate appetites that were asleep.
And what does all this have to do with Bitcoin? A lot. More and more, Bitcoin is showing sensitivity to the global monetary context. When liquidity abounds and rates fall, interest in alternative assets grows. This was clearly seen in the years after 2020, when monetary stimuli drove Bitcoin to historical maximums. If the loss of rates in Switzerland is an early sign that European central banks will begin to relax their position, we could be entering a phase of greater appetite due to risk. Bitcoin, as a scarce active and without a risk of counterpart, is usually one of the great beneficiaries in that type of environments.
It is worth clarifying that the impact will not be immediate, but the conditions are maturing. If other central banks follow this path, The world could re -enter an era of cheap financing and expansive liquidity. And in those scenarios, Bitcoin usually finds his opportunity to shine.
Discharge of responsibility: The views and opinions expressed in this article belong to its author and do not necessarily reflect those of cryptootics. The author’s opinion is informatively and under no circumstances constitutes an investment recommendation or financial advice.
