Bitcoin’s Appeal Grows Stronger as Washington Downplays the $36 Trillion Debt Burden

Key Takeaways

• Coinbase CEO Brian Armstrong warns that Bitcoin could emerge as a global reserve currency if the U.S. fails to address its soaring $37 trillion debt.
• Tyler Winklevoss of Gemini reacted to a viral chart showing U.S. debt above $36 trillion with a simple message: “Buy Bitcoin.”
• The Institute of International Finance warns that exploding U.S. debt could lead to contagion in global bond markets.

As the U.S. debt spirals past historic highs, cracks are starting to show—not just in Washington’s balance sheets but in the global financial order itself.

Confidence in the dollar is wobbling, investors are growing cautious, and a new contender is waiting in the wings.

From Bitcoin (BTC) evangelists to seasoned economists, a fierce debate is underway on how a digital asset born from a crisis can challenge the world’s most powerful currency.

Armstrong Sees Bitcoin as the Next Currency Reserve

Coinbase CEO Brian Armstrong warned that Bitcoin could become the world’s next reserve currency if the U.S. fails to address its $37 trillion debt.

“I love Bitcoin, but a strong America is also super important for the world,” he tweeted Tuesday, urging fiscal reform.

His comments follow the House’s passage of a Donald Trump-backed bill in May that extends tax cuts, increases military spending, and slashes programs like Medicaid and clean energy.

As financial concerns mount, Bitcoin’s appeal is rising, thanks to its fixed supply and inflation-resistant design, drawing growing interest from institutions and state governments.

Gemini’s Tyler Winklevoss echoes Armstrong’s warning, sharing a viral chart showing U.S. debt topping $36 trillion: “Buy Bitcoin.”

The chart, resembling a tech stock in a bull run, shows federal debt rising vertically from the early 2000s with no signs of slowing.

Washington Downplays High Debt Burden

Treasury Secretary Scott Bessent ruled out a U.S. debt default, even as concerns grow over President Trump’s sweeping tax bill, which could deepen the country’s fiscal challenges.

Speaking on CBS’ Face the Nation , Bessent said, “The U.S. is never going to default, we are on the warning track, but we will never hit the wall.”

Trump’s bill narrowly passed the Hoouse. It now heads to the Senate, where tough negotiations are expected. The debt ceiling “X date” is projected between late August and mid-October.

Bessent voiced confidence in Senate approval, noting Majority Leader Thune has “a bigger majority.”

If the ceiling isn’t raised in time, the government could face spending cuts and payment delays.

Trump‘s bill aims to make 2017 tax cuts permanent, add breaks for tips, overtime, and seniors, and raise the debt ceiling by $4 trillion.

Reinstated in January at $36.1 trillion, the ceiling had been suspended since 2023.

Peter Schiff Doubts 1 Million Bitcoins Could Cover U.S. Debt

Peter Schiff, Chief Economist & Global Strategist at Europac.com, doubts that 1 million Bitcoins could ever pay off the U.S. national debt.

At $100,000 per coin, that’s only $100 billion—far short of the necessary $36.25 trillion. For it to work, Bitcoin’s price would need to rise by over 20,000%, which Schiff calls unrealistic.

He argues that even if Bitcoin grows in value, the U.S. debt will keep increasing, making reaching the goal more challenging.

Schiff also questions Bitcoin’s global adoption and sees its price driven more by speculation than real demand.

While some supporters see it eventually reaching $1 million per coin, he sees that as wishful thinking.

Real Risk Behind High Debt

Treasury yields are spiking as concerns grow that investor demand for U.S. debt is weakening just as supply will surge, with a new budget bill which may to add trillions more to the deficit.

The Institute of International Finance (IIF) warns that rising U.S. debt won’t just strain America—it could spark global financial ripples.

According to the IIF, higher U.S. borrowing and debt-driven volatility could spread across global bond markets, particularly in interconnected economies like the UK, Germany, and France.

Weak demand at recent bond auctions has fueled fears of a “buyer’s strike,“ especially among foreign investors, as Deutsche Bank noted.

Even Japan‘s bond market influences U.S. yields, highlighting how shifts in global capital flows can amplify Treasury volatility.

Emerging markets are especially vulnerable, as rising U.S. debt reduces the pool of international capital, threatening their financial stability.

With over 60% of global debt portfolios tied up in the U.S. and Eurozone, the growing strain from U.S. debt is becoming a systemic global risk.