The US national debt has surged to a record-breaking $37 trillion, intensifying concerns over fiscal policy and fueling speculation that Bitcoin (BTC) could rally to $132,000 by the end of 2025. Analysts point to the potential for looser monetary policy and rising money supply as key drivers that could propel the world’s largest cryptocurrency to new highs.
Representative Thomas Massie highlighted the milestone in an X post on Wednesday, stating:
“Thanks to the One Big Beautiful Bill Act, the debt just officially passed the $37 trillion mark.”
The record figure comes just one month after US President Donald Trump signed the One Big Beautiful Bill Act on July 4. While the president claimed the legislation would reduce federal spending by up to $1.6 trillion, the national deficit has continued to grow.
Rising Deficits and Monetary Policy Implications
Economic analysts warn that sustained deficit growth can eventually trigger more accommodative monetary policies, such as quantitative easing (QE)—a process in which central banks purchase large amounts of government bonds to inject liquidity into the economy.
Proponents of Bitcoin argue that such measures, which expand the money supply, could enhance BTC’s appeal as a scarce monetary asset, particularly during periods of heightened inflation.
US Treasury data shows the national debt has climbed from $26.7 trillion in 2020 to over $37 trillion today—a staggering 38% increase in just five years. Over the same period, Bitcoin’s price surged more than 925%, a trend that Bitget chief analyst Ryan Lee says is “directly correlated” with debt growth.
“Ultimately, this will impact the American monetary system as a considerable amount of cash will be deployed into servicing this debt,” Lee explained.
“The more the debt grows, the higher the likelihood of BTC price soaring to new highs.”
He also suggested that the US government might one day explore Bitcoin as part of a strategy to address its “massive national debt.”
Elon Musk voiced his own concerns over the spending bill in a June 5 X post, warning it would “increase the deficit to $2.5 trillion.”
Money Supply Growth Could Drive Bitcoin to $132K
Analysts say that servicing the ballooning debt could also expand the global M2 money supply—a measure of cash, checking deposits, and easily convertible near-money—which has historically shown a strong correlation with Bitcoin’s price.
Jamie Coutts, chief crypto analyst at Real Vision, estimates that continued M2 growth could push Bitcoin above $132,000 before the end of 2025. “The rising inflation and increase in M2 money supply may catalyze Bitcoin’s rally to the $132,000 high,” Coutts noted.
However, this forecast is conservative compared to views from Arthur Hayes, co-founder of BitMEX and chief investment officer at Maelstrom, who has predicted Bitcoin could climb to $250,000 if the Federal Reserve resumes QE in response to inflationary pressures.
Conclusion:
With the US debt accelerating and monetary expansion looming, Bitcoin’s narrative as a hedge against inflation and fiscal instability appears stronger than ever. While price targets vary widely, many market watchers agree that the macroeconomic backdrop could set the stage for BTC’s next major rally.
