Trump signed and passed the "Big and Beautiful" tax and spending bill, raising the U.S. debt ceiling by $5 trillion
On July 4, local time, on American Independence Day, President Donald Trump signed a $3.3 trillion tax and spending bill named "Big and Beautiful" at a White House celebration ceremony.
This bill passed both houses of Congress by a narrow margin, with its core content including significant tax cuts, deep spending reforms, and the largest increase in the U.S. debt ceiling in history, raising it by $5 trillion.
The bill permanently extends some key tax cut policies from the Trump era and introduces new deductions for tips, overtime pay, and auto loan interest, while also expanding the deduction cap for state and local taxes (SALT) for middle-income families.
However, to balance the budget, the bill also significantly cuts Medicaid, food assistance programs, and student loan subsidies. The Congressional Budget Office estimates that this will increase the U.S. fiscal deficit by $3.3 trillion over the next decade.
This dramatic shift in fiscal policy has not escaped the close attention of the cryptocurrency market. Analysts warn that the massive new debt could weaken the international status of the dollar and may prompt investors to seek non-sovereign assets like Bitcoin as a store of value.
Furthermore, the inflationary pressures that this spending plan may bring could also accelerate demand for cryptocurrencies. Shortly after the bill was signed, Bitcoin's price indeed reacted, briefly climbing above $108,000.
Although the market has experienced volatility in the short term, investors remain cautious. They are closely monitoring the potential policy responses from the Federal Reserve regarding the soaring debt levels, which will have a significant impact on the sustainability of the cryptocurrency rally.
Currently, it seems that Trump's legislative victory sets the tone for a new fiscal era, which may bring structural benefits to the traditional financial markets and digital asset markets in the coming months.
The "Big and Beautiful" bill signed and passed by Trump not only leads to a significant increase in the U.S. debt ceiling but may also trigger dollar over-issuance, inflationary pressures, and ripple effects in global financial markets.
So how will this fiscal storm evolve? What impacts will it bring to global financial markets? We shall wait and see!
