The Truth Behind Bitcoin's Surge and Its Impact on US Debt

Bitcoin has broken through historical highs, seemingly driven by expectations of interest rate cuts from the Federal Reserve and an influx of institutional funds. In reality, it reflects a deep crisis in the global credit currency system. As geopolitical conflicts escalate in 2024 and US debt surpasses $35 trillion, investors are voting with real money to restructure asset allocation logic: companies like MicroStrategy continue to increase their holdings in Bitcoin as 'digital gold,' while traditional safe-haven assets like US Treasury bonds are being sidelined.

In the medium term, while Bitcoin's volatility persists, the narrative of 'de-dollarization' will continue to divert funds from the US Treasury market. When the yield on 10-year US Treasury bonds is forced to rise due to weak demand, the US fiscal deficit may fall into a vicious cycle—high interest rates increase repayment pressure, pushing the Federal Reserve to restart quantitative easing, which in turn strengthens Bitcoin's anti-inflation properties. This battle between old and new assets may reshape global capital flows, putting the 'risk-free' halo of US debt to a historic test.