The Scale of US Debt 

Official estimates place total debt between $36.99 and $37.21 trillion. This translates into more than $108,000 of debt per citizen. Some analysts, however, calculate a much higher figure. Former Coinbase CTO Balaji Srinivasan claims that including Social Security, healthcare, and pensions brings the true liability to $175.3 trillion. 

Past crises like the Vietnam War, the 2008 financial meltdown, bank bailouts, and COVID-19 stimulus packages triggered sharp debt spikes. Still, debt has also risen steadily outside of crisis periods. This long-term trend raises concerns about future repayment risks. 

Washington occasionally sets a debt ceiling to curb growth, but each time it gets lifted. In May 2025, Congress raised the limit by another $4 trillion. The dollar retains its strength as the world’s reserve currency, but sustainability remains a major debate. 

The US is broke.
The real debt is $175T+.
And @elonmusk is 100% correct on the numbers.
But the difficult step is the logical conclusion.
There is no fix. It's a writeoff. A national bankruptcy.
And the default will be in the form of money printing. pic.twitter.com/dypr59wv60

— Balaji (@balajis) July 1, 2025

Can Crypto Support Debt Management? 

VanEck research suggests that if Senator Cynthia Lummis’s proposed Bitcoin Act passed, the US could acquire one million Bitcoin by 2029. Assuming Bitcoin maintains a 25% annual growth rate, this reserve could reach $21 trillion by 2049. That amount would cover around 18% of total US debt. Still, there is no sign such a plan will be executed. 

Stablecoins offer another possible tool. Wider adoption of dollar-based stablecoins would boost demand for US Treasuries and strengthen global dollar usage. This would lower borrowing costs, though it would also make US exports more expensive, pressuring trade balances. 

In the end, no single solution will resolve the challenge. Crypto assets, tariffs, and currency strategies can only work in combination. Managing the debt at a sustainable level, alongside international cooperation, appears to be the real goal. 

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What Does $37 Trillion Mean?

By mid-2025, total federal debt rose to $36.8 trillion and is expected to exceed $37 trillion soon. This amount equals about 123% of the US Gross Domestic Product (GDP), surpassing World War II era debt levels. The Congressional Budget Office (CBO) predicts this ratio will exceed 130% over the next decade if current policies continue. 

Russian Foreign Minister Sergey Lavrov stated that the US debt level is out of control. He also said the US dollar is no longer a reliable means of payment.
Lavrov commented, “COVID-19 revealed numerous flaws in the global trade and financial system. The dollar turned into a penalty tool. Trust has been shaken.” He highlighted that the number of highly indebted countries rose from 22 in 2011 to 59 today.  These remarks reveal that the growing US debt burden causes concerns not only locally but also for global financial stability. 

Key Risks and Economic Impacts 

• Rising Interest Payments: As interest rates rise, the government will pay over $1 trillion annually in interest. This amount is close to, or even surpasses, the defense budget, potentially overshadowing health, infrastructure, and education spending. 
• Slowing Economic Growth: Economists warn that shifting investments from private to government debt may harm productivity and wage growth. Studies suggest rising debt could reduce GDP by over 1% by 2035, leading to millions of job losses. 
• Inflation and Fiscal Imbalance: Large budget deficits may force central banks to keep interest rates low, complicating inflation control and weakening monetary policy effectiveness. 
• Credit Rating and Investor Confidence: Moody’s downgraded the US credit outlook in 2024. This could raise borrowing costs and cause investors to lose confidence. Higher Treasury yields may increase volatility in both domestic and global markets. 

Pressure on the US Dollar

Increasing debt and deficits erode confidence in the dollar. While still the global reserve currency, fiscal indiscipline pushes investors away, creating downward pressure on the dollar’s value. 

Billionaire investor Ray Dalio warns that Treasury supply will outpace demand, driving inflation up and the dollar down. Fiscal experts say uncontrolled spending could add $6 trillion to debt and increase interest costs over the next decade. Institutions like the Cato Institute and Peter G. Peterson Foundation call for bipartisan reforms. 

Still, the US retains important advantages. The dollar’s global reserve status maintains strong demand. Most debt is held domestically by government funds and American investors, reducing foreign sales risk. In global crises, investors view US Treasuries as a safe haven. Despite high debt, borrowing costs remain relatively low. 

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US Treasury Chief: Urges Congress to Raise Ceiling

In an interview with CBS News, he said: 

“The United States will never default. That will never happen; we are on the warning line and will not hit the wall.” 

Bessent’s remarks came as Congress approaches the mid-July deadline to raise the debt ceiling. Current estimates indicate that the government’s borrowing authority will be exhausted by that date. Bessent warned that if the debt ceiling is not raised before then, the government may lose its ability to make debt payments. Budget analysts predict the Treasury will exhaust its extraordinary measures to make debt payments by the end of summer. 

Bessent also pushed back against JPMorgan CEO Jamie Dimon’s warnings of a collapse in the U.S. bond market. Dimon criticized government spending post-pandemic and quantitative easing policies. He suggested that rising debt levels could increase the risk of a future crisis. However, Bessent noted that Dimon’s past predictions have not come true: 

“I’ve known Jamie for a long time, and throughout his career, he has made such predictions. Fortunately, none have been accurate,” he said. 

Bessent said that reducing the debt level will be a gradual process over four years. Additionally, former President Trump used his proposed tax and spending package as a tool to raise the debt ceiling. This package could further increase the debt level. 

These concerns led Moody’s Ratings to downgrade the US credit rating from the highest level, Aaa, to Aa1. Moody’s became the third major credit rating agency to downgrade the U.S. government’s credit rating since 2011. 

US Treasury Secretary Scott Bessent emphasizes that the country will not default despite its debt load. He called on Congress to raise the debt ceiling. However, concerns about debt sustainability and economic stability remain. 

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