The US federal debt has surged to a record $37 trillion, prompting debate over its economic impact and fuelling forecasts that Bitcoin could climb to $132,000 by the end of 2025.
Representative Thomas Massie announced the milestone on X, linking it to the “One Big Beautiful Bill Act,” signed into law by President Donald Trump on July 4.
Trump claimed the bill would cut federal spending by up to $1.6 trillion, but the deficit has continued to rise.
Debt Growth and Policy Outlook
The record debt comes amid concerns that swelling deficits could lead to looser monetary policy.
This includes the possibility of quantitative easing (QE) — large-scale government bond purchases by the Federal Reserve to add liquidity to the economy.
Bitcoin advocates say that such measures, which can expand the money supply, often highlight the cryptocurrency’s fixed supply, potentially boosting demand.
Ryan Lee, chief analyst at Bitget, noted that US debt has grown from $26.7 trillion in 2020 to over $37 trillion — a 38% increase in just five years.
During the same period, Bitcoin’s price rose more than 925%, which Lee described as “directly correlated” with debt growth.
“The more the debt grows, the higher the likelihood of BTC price soaring to new highs,” he said.
Lee even suggested the US government might one day consider Bitcoin as a tool to address its national debt.
Market Forecasts
Jamie Coutts, chief Crypto analyst at Real Vision, believes that servicing the debt could drive global M2 money supply growth.
Based on Bitcoin’s correlation with fiat money supply, he projects a price of $132,000 before the end of 2025.
Tesla CEO Elon Musk has also criticised the spending bill, warning in June that it would raise the deficit to $2.5 trillion.
If inflation rises and QE returns, some analysts, including Arthur Hayes, co-founder of BitMEX, see the potential for Bitcoin to reach $250,000.
While opinions vary, the link between debt expansion, monetary easing, and Bitcoin’s perceived value remains central to these bullish projections.