Cryptocurrencies rally as Bank of Japan move lifts lingering macro uncertainty.

Bitcoin and ether extended gains on Friday, breaking above key technical levels as Asian equities advanced following the Bank of Japan’s interest-rate hike to the highest level in three decades and softer U.S. inflation data revived risk appetite.

Bitcoin traded above $87,000 during Asian hours, while ether climbed in tandem with broader markets. Investors largely looked past the BOJ’s widely anticipated policy move, instead focusing on signs that global financial conditions may be easing.

Altcoins joined the advance, with Cardano’s ADA, Solana’s SOL, dogecoin, BNB and XRP rising by as much as 3%. The broad CoinDesk 20 Index gained 2%, underscoring the strength of the move across the digital-asset market.

The rally followed a volatile but largely range-bound session that saw more than $576 million in crypto liquidations over the past 24 hours, according to CoinGlass. Most of the liquidations were concentrated in long positions, highlighting how crowded positioning had become during the recent rebound and the continued reliance on high leverage to capture incremental gains.

In Japan, the 10-year government bond yield briefly touched 2% for the first time since 2006 after the central bank raised its benchmark rate, a step that had been widely telegraphed after weeks of hawkish signals from Governor Kazuo Ueda. Markets absorbed the decision smoothly, with the yen weakening and regional equities climbing.

The MSCI Asia Pacific Index rose 0.7%, led by technology shares, while U.S. equity futures extended their rebound. The S&P 500 advanced 0.8% and the Nasdaq 100 jumped 1.5%, supported by an upbeat outlook from Micron Technology that helped ease concerns about artificial intelligence spending and elevated valuations.

Risk sentiment was further supported by softer U.S. inflation data, reinforcing expectations that the Federal Reserve could begin cutting interest rates in the coming months.

On-chain data also suggests selling pressure may be easing. Long-term bitcoin holders appear close to ending a prolonged distribution phase, according to K33 Research, after roughly 20% of supply rotated back into the market over the past two years.

Even so, traders remain cautious. The recent bounce has been driven more by macro relief than deep conviction, leaving crypto markets exposed to sharp moves as year-end approaches amid thinner liquidity and elevated leverage.

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