The increase in US public debt puts downward pressure on the value of the USD, driving money into Bitcoin as a safer asset storage channel.
The public debt is expected to increase by more than $3 trillion over the next 10 years, causing financial experts to warn of the risk of currency devaluation, making Bitcoin an attractive asset store in the context of financial instability.
MAIN CONTENT
Ray Dalio warns that US public debt is devaluing the USD, threatening the preservation of traditional assets.
Bitcoin is seen as an effective collateral asset when the US dollar loses value due to uncontrolled money printing.
Experts and major CEOs in the crypto industry actively call for investing in BTC as a solution to preserve value.
Where does US debt uncertainty put Bitcoin?
Ray Dalio, founder of Bridgewater Associates, said that rising public debt could cause the value of the dollar to decline sharply, hurting traditional investors and the US credit market. According to him, in the next 10 years, the debt level could become an unsustainable burden for US families, leading to tax increases, spending cuts or widespread money printing.
Mr. Dalio said:
“Printing money and devaluing it is not good for people who hold bonds as a store of value, bad for bonds and the US credit market will negatively affect everyone.”
Ray Dalio, Founder of Bridgewater Associates, July 4, 2025
The CBO report projects the new spending bill will add about $3 trillion to the national debt over the next decade, posing the risk of a deep and prolonged decline in the value of the dollar.
Why is Bitcoin considered a safe haven in a currency crisis?
Crypto leaders say Bitcoin exists to address the very risks posed by uncontrolled monetary policy on the US dollar and other fiat currencies. Because Bitcoin has a limited supply and cannot be printed, it becomes an effective safe haven asset when the US dollar loses value, making traditional assets such as gold, Bitcoin and other scarce commodities attractive.
Matt Hougan, Chief Investment Officer of Bitwise, urges the community to buy Bitcoin to preserve asset value:
“Buy Bitcoin Now.”
Matt Hougan, Bitwise Chief Investment Officer, 4/7/2025
Raoul Pal of Real Vision also emphasized that only technology and cryptocurrencies are the most effective risk-hedging channels in the context of global currency devaluation.
“In long-term bull markets, only technology and cryptocurrencies really excel as hedges against depreciation.”
Raoul Pal, CEO Real Vision, 4/7/2025
Major Investors' Views on Bitcoin and the US Dollar
Ray Dalio owns a small portion of Bitcoin, but he still prefers gold because it is more stable and easier to track. Meanwhile, Larry Fink, CEO of BlackRock, calls Bitcoin “digital gold” and warns that the US dollar could lose its position as the world’s reserve currency if the public debt is not well controlled.
In contrast, US Treasury Secretary Scott Bessent is confident that GDP growth is outpacing public debt growth, downplaying concerns about current financial risks:
“GDP growth has outpaced public debt and this trend will continue in the coming time.”
Scott Bessent, US Secretary of the Treasury, July 4, 2025
Coinbase analysts said that increasing the debt limit by another $5 trillion could force the US Treasury to “re-inject” the TGA account, drawing a large amount of liquidity from the market, putting downward pressure on risk assets including Bitcoin.
“The re-introduction of TGA could drain liquidity from short-term markets, creating significant risks to risky assets.”
Coinbase Analyst, 7/4/2025
Frequently Asked Questions
Why Does US Debt Affect Bitcoin?
The increase in public debt has caused the USD to lose value, pushing investors to seek Bitcoin as a safer store of value.What does Ray Dalio think about Bitcoin?
He admits to owning BTC but still prefers gold for its stability and ease of tracking at the moment.Can Bitcoin Replace the USD as a Reserve Currency?
Larry Fink believes that if the United States fails to effectively control its public debt, Bitcoin could become the global reserve currency.How does the TGA account re-injection affect the market?
This could drain liquidity from the market, putting downward pressure on risk assets like Bitcoin.Why is Bitcoin considered “digital gold”?
Bitcoin has a fixed supply and cannot be printed, so it is considered a safe haven against inflation and currency devaluation.
Source: https://tintucbitcoin.com/bitcoin-and-no-cong-my-3-nghin-ty/
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