@SunSun
People kept talking about shit iron but most people do not know why Japanese iron was shit. In reality, iron is iron, it's neither shit not gold. Here's the reality: Japan mostly has only iron sand. That by itself does not mean the iron is shit. Iron is ferum, ferum is the same everywhere else. The same ferum that exists in Japan exists in Europe too. Just because you bring Japanese iron to Europe, it will not make any weapon made using the Japanese iron automatically shit.
The problem with Japanese iron is that they only have iron sand, and iron normally does not want to stay as powder. Iron readily bonds with a lot of other elements. So the only way iron can stay as iron sand (and not merge into a rock) is because it has bonded with other elements such as sulphur, titanium, quartz or calcium that prevented it from forming into rocks. When iron sand is harvested, these impurities also exist in abundance. The product of the smelting of iron sand, the tamahagane, is basically high-carbon cast-iron. This high-carbon cast iron is purposely made to get rid of all the impurities because if they didn't do it, the iron will become weak and brittle regardless of their smithing skills.
The thousand-folding method is basically their way of reducing this carbon content after the smelting is done and all the impurities were driven out. The more they heat and fold the blade, the more they drive out the carbon, and the number of folding plus the lack of plasticity of the steel allows the master blacksmiths to guess how much carbon is present in the blade so that they can adjust it accordingly. We still use this technique in the modern era except we call it 'heat treatment' now. It's basically the same concept.