Berkshire Hathaway in danger as Japanese bonds crash, but Warren Buffett still won’t touch Bitcoin that’s making new ATHs

Berkshire Hathaway is in deep trouble as Japan’s bond market unravels, and Warren Buffett refuses to even glance at Bitcoin, which just crossed a record-breaking $111,000.

The current historic surge in Japanese bond yields is threatening to blow up the exact strategy Warren used to justify his billion-dollar bets on Japan’s five major trading houses.

While global investors are flooding into crypto and banking record profits, Warren is doing the exact opposite—selling off his only crypto exposure and doubling down on a play that’s now bleeding from all sides.

Warren raised ¥281.8 billion in October 2024, then followed up with a much smaller ¥90 billion in April 2025 through yen-denominated bonds. Those funds were used to build positions close to 10% in Mitsubishi, Mitsui, Itochu, Marubeni, and Sumitomo.

It worked at first. Borrow at 0.5% interest, buy stocks paying ~5% in dividends. Easy cash. But now, as Japan’s bond yields rise fast, that carry trade strategy is getting torched. New bond issues cost more. The interest spread shrinks. The profit vanishes.

Japanese stocks drop as yields kill equity valuations

Shares of the five trading houses aren’t holding up either. In 2025 alone, Mitsui’s down 20%, Itochu has lost 16%, and the rest are sliding. Higher yields usually signal tighter policy, and tighter policy kills equity valuations—especially ones built on stable dividends.

Berkshire’s portfolio in Japan is loaded with those. The damage gets worse when you factor in the trade tensions triggered by Donald Trump’s latest tariffs, which rattled Japanese markets earlier this year and forced companies like Asahi and Suntory to walk away from bond deals completely.

Berkshire didn’t back out, but the ¥90 billion bond it issued this April was the company’s smallest ever. That’s not a flex. That’s caution. The situation’s turning so fast that the same assets Warren called “long-term holdings” are now dipping below what he paid. And while he’s always claimed to like cheap stocks, these ones might get cheaper than he’s willing to admit.

Currency swings and bond pressure weaken Berkshire’s hedge

There’s another issue Berkshire can’t dodge: the yen. The company’s bonds and dividends are all yen-based, which was supposed to act as a hedge. If the yen dropped, Berkshire’s debt would be easier to repay. That hedge only works when the yen stays weak.

But in July 2024, when the Bank of Japan surprised markets with a rate hike, the yen got stronger, fast. If yields keep going up, the yen could climb again. That turns the hedge against Warren. It slashes the dollar value of dividends, hurts returns, and messes with the company’s ability to balance its foreign books.

Still, despite the rising risks, Warren’s been stubborn. He hasn’t sold his Japanese positions. He hasn’t moved away from the bond strategy. And he sure ain’t touching Bitcoin, which just set back-to-back all-time highs this week. That’s after Berkshire dumped its entire stake in Nu Holdings, the Brazilian fintech firm behind crypto-friendly Nubank.

Bitcoin explodes after Warren exits Nubank and ditches crypto

Warren’s firm closed out of Nubank in Q1 2025, walking away with $250 million in profit. That move officially ended Berkshire’s one and only link to crypto.

While Warren was cashing out, Bitcoin surged to $109,800, then jumped again to $111,762 on Wednesday, fueled by renewed institutional interest and support for the GENIUS Act in the Senate. That bill lays out new rules for stablecoins and has been a major boost for confidence in the space.

Traders also took advantage of the momentum, with over $900 million in short positions liquidated, based on data from CoinGlass. Ethereum, XRP, and Solana all followed Bitcoin’s lead, climbing as the crypto market roared.

Meanwhile, Berkshire boosted its cash pile to $347.8 billion, mostly held in US Treasurys, after also unloading shares of Citigroup and Bank of America.

Warren once called Bitcoin “rat poison squared,” and it doesn’t look like his opinion has evolved. Despite the rally, despite the regulation, despite even Jamie Dimon, longtime Bitcoin skeptic and JPMorgan CEO, telling clients they can now buy the coin through the bank, Warren hasn’t budged.

At Berkshire’s latest shareholder meeting, an attendee named Jackie Han asked about the company’s take on real estate. Warren laughed and said if he had to pick between real estate and stocks for life, he’d go with stocks every time.

“There’s just so much more opportunity, at least in the United States, that presents itself in the security market than in real estate,” Warren said.