Trends Cryptos

United States: public debt increases by 10 million BTC in one day

Temps de lecture : 2 minutes

In the United States, on October 4, the public debt saw a record increase of $275 billion. To understand the extent of this increase, simply compare this amount to the market capitalization of Bitcoin which represents almost half of it. Discover the potential consequences of this worrying situation for the global economy and the cryptocurrency market.

The frantic increase in the public debt of the United States

According to a tweet posted by crypto analyst Samson Mow, the daily increase in US public debt is equivalent to more than half of the market capitalization of Bitcoin. Indeed, the $275 billion added to the US debt far exceeds the market capitalization of Ethereum, which is currently just under $200 billion.

  • Two weeks ago, BeInCrypto reported that the total debt of the United States was equivalent to 33 times the market capitalization of the cryptocurrency market.
  • Over the past fortnight, the US government has added $32 billion in debt per day to its balance sheet, according to The Kobeissi Letter.

The unbearable burden of interest

In 2022, interest payments cost the US government $476 billion, or almost 2% of its GDP. Similarly, the Peter G. Peterson Foundation estimates that Uncle Sam will have to repay $10.6 trillion in interest over the next decade. Thus, the federal debt could represent 181% of GDP by 2053 according to a projection from the Congressional Budget Office.

It is important to note that the debt ceiling will remain unlimited until January 2025, which means that the United States’ public debt will continue to rise in the months to come.

The consequences for the global economy and cryptocurrencies

America’s growing debt raises serious concerns about its ability to maintain long-term economic stability. Indeed, this situation could have negative repercussions on the value of the US dollar and, consequently, on the global economy.

On the other hand, the increase in US public debt could potentially be a favorable factor for the cryptocurrency market, particularly Bitcoin. With the combined market capitalization of major cryptocurrencies still relatively small compared to that of the global economy, their adoption could accelerate as an alternative to traditional currencies.

Cryptocurrencies as a refuge from economic uncertainty

This situation could encourage investors to turn to cryptocurrencies as a means of diversification and protection against growing economic uncertainty. In fact, with public debt continuing to increase, traditional financial assets are becoming increasingly risky.

In conclusion, the dramatic increase in US debt in a single day highlights the importance of the development and adoption of cryptocurrencies. As the market capitalization of Bitcoin still has significant room for growth compared to that of the global economy, it is essential to carefully monitor the evolution of this situation to anticipate its consequences on the cryptocurrency market and the economy in general.

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