Caution has been raised over expectations in parts of the market that changes in Japan's monetary policy will immediately trigger a sharp rise in the price of XRP in July.

A blockchain outlet, The Crypto Basic, reported on June 3 that XRP community analyst Eri said the possibility of yen carry trade unwinds in Japan has been excessively inflated.

Speculation has spread in the XRP community that monetary tightening from Japan could increase stress in global financial markets and, as a result, sharply boost demand for XRP as a neutral bridge asset. The logic is that XRP could benefit in the process of international payments and liquidity provision.

Eri said the scenario was unlikely to materialise immediately, citing the Bank of Japan's policy rate path. Japan's policy rate rose from about minus 0.1 percent in April 2023 to 0.75 percent in December 2025, but the pace of increases was predictable and gradual, Eri said. Under that trajectory, institutional investors and leveraged traders would have ample time to adjust positions gradually, Eri said. Eri said it was not an environment that would spill over into broad, abrupt liquidations across markets.

Eri also said a larger repositioning phase could begin only when Japanese rates approach around 1.5 percent. Eri added that point could still be 18 to 24 months away, and assessed the likelihood of a disorderly yen unwind as relatively low.

Liquidity limitations on the XRP Ledger were also cited as a factor constraining a short-term rebound in XRP. Eri cited comments by Brett Mollin (브렛 몰린), head of the XRPL Foundation, and said a lack of liquidity is among the biggest obstacles to the spread of XRPL. That means market depth must increase first for XRPL to absorb broader payment and settlement demand.

Eri said stablecoins USDT and USDC from Tether and Circle still dominate international transaction and settlement flows. Eri described the structure as a "stablecoin sandwich". As stablecoins expand their role as an intermediary asset in global transactions between fiat currencies, the space XRP can take is not large in the near term, Eri said.

Eri did not dismiss XRP's medium- to long-term potential. Eri said XRP could also benefit if global payments and tokenised finance grow. But Eri said expectations that a change in Japan's monetary policy alone will produce an immediate price explosion are exaggerated.

Market moves were also not supportive. XRP fell about 7.75 percent over the past week to $1.20. Expectations tied to Japan's rate variables grew, but the price failed to gain traction amid broader weakness across the cryptocurrency market.

The debate shows it is difficult to explain expectations for XRP's price using only Japan-driven macro factors. With Japan's rate normalisation continuing gradually and internal liquidity issues on XRPL remaining, the analysis said it is necessary to watch whether market structure changes and liquidity expands, rather than focus on a short-term surge thesis.

Chatter about a massive yen unwind in July that will cause the XRP price to spike because the world will use the asset for global liquidity is on the rise again. First, this step-function chart (Japan Times graphic) clearly shows the slow, predictable stair-step increases with… pic.twitter.com/eKzYlroQ9l