New Bitcoin High Expected Amid Soaring US Deficit
The U.S. federal debt has climbed to an unprecedented $37 trillion, intensifying concerns that mounting deficits and potential money supply growth could drive Bitcoin to $132,000 by the end of the year.
Representative Thomas Massie highlighted the milestone in a Wednesday X post, referencing the “One Big Beautiful Bill Act” signed into law by President Donald Trump on July 4. The administration says the bill aims to cut as much as $1.6 trillion in federal spending, though the deficit has nonetheless hit new highs.
Analysts note that expanding deficits can eventually trigger looser monetary policy, such as quantitative easing—central bank bond purchases that inject liquidity into the economy. Bitcoin proponents argue that a growing money supply and inflation fears could renew interest in Bitcoin’s scarcity, pushing its price to record levels.
U.S. Treasury data shows that national debt has grown from $26.7 trillion in 2020 to over $37 trillion today—a 38% increase in just five years. Over that same period, Bitcoin has surged by more than 925%, a rise that
Bitget’s chief analyst Ryan Lee calls “directly correlated” with U.S. debt growth. Lee suggested that if debt continues to climb, Bitcoin has a higher chance of breaking new price records, even hinting that the government might explore Bitcoin as part of a strategy to address its debt. He added that “the odds are stacked in favor of Bitcoin.”
Tesla CEO Elon Musk also criticized the spending bill earlier this year, warning it would increase the deficit to $2.5 trillion. Servicing the debt could expand the global M2 money supply, which Real Vision’s chief crypto analyst Jamie Coutts sees as another possible catalyst for Bitcoin. Based on past correlations, Coutts estimates this could propel BTC above $132,000 before the end of 2025.
Some analysts have even more ambitious targets. Arthur Hayes, co-founder of BitMEX and CIO at Maelstrom, believes Bitcoin could reach $250,000 if the Federal Reserve shifts back to quantitative easing in response to inflationary pressures.
Sources:
https://cointelegraph.com/news/trump-big-beautiful-bill-us-debt-record-37t-congressman-massie
https://fiscaldata.treasury.gov/datasets/historical-debt-outstanding/historical-debt-outstanding
https://x.com/RepThomasMassie/status/1955439666842173864