The U.S. Department of the Treasury is expected to issue over $31 trillion in bonds in 2025—equivalent to 109% of GDP and 144% of the total M2 money supply—which is creating significant impacts on global financial markets, including the digital currency sector.

📉 Negative impacts on the digital currency market

1. Rising bond yields: The issuance of a large amount of bonds may push yields higher, making non-yielding assets like Bitcoin less attractive compared to traditional financial instruments.

2. Strengthening USD: If demand for U.S. bonds decreases, the Treasury may have to raise interest rates to attract investors, leading to a stronger USD. This often puts downward pressure on risk assets like digital currencies.

3. Global liquidity tightening: Higher yields may reduce global liquidity, causing investors to withdraw from risk markets, including digital currencies.

🛡️ Potential positive impacts

1. Bitcoin as “digital gold”: With a limited supply and decentralized nature, Bitcoin can be seen as a hedge against inflation and currency devaluation, attracting investors in times of economic uncertainty.

2. Portfolio diversification: The volatility of traditional markets may drive investors to seek alternative investment channels like digital currencies to mitigate overall risk.

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