With the US national debt exceeding $37 trillion, concerns over the country's financial future are growing. This article explores potential solutions offered by Bitcoin and stablecoins.
Increase of US Debt
The US debt is growing by approximately $4.27 billion every day, reaching $37 trillion so far. Experts warn that if nothing changes, interest payments alone could consume the entire budget, leaving little for social programs, defense, or public services. Recently, Elon Musk stated that the US is on the brink of 'de facto bankruptcy,' with interest payments accounting for 25% of government revenue.
Why Bitcoin Might be the Solution
Analysts are now calling Bitcoin a protective asset, especially as each American indirectly holds over $106,000 in national debt. That number rises to $323,000 per taxpayer. Over the past decade, as US debt doubled, Bitcoin's price soared from under $500 to over $111,000. In uncertain times, Bitcoin is viewed as a 'life raft.' Raoul Pal, founder of Real Vision, believes that Bitcoin not only protects against inflation but also appreciates as more people adopt it.
Stablecoins: A Surprising Ally
While Bitcoin acts as a hedge, stablecoins may serve another role — one that could help reduce the debt itself. US Treasury Secretary Scott Bessent recently suggested that stablecoins may be backed by US Treasury bonds. As the stablecoin market grows, demand for these bonds could rise, possibly lowering government borrowing costs. The GENIUS Act, which aims to regulate stablecoins and mandate Treasury bond holdings, has passed the Senate and awaits a House vote.
The rise of the US national debt compels experts and investors to seek new solutions. Bitcoin and stablecoins emerge as key candidates for enhancing financial stability in the country.
