U.S. Treasury bonds surpass $38.5 trillion, a new high; long-term macro bullish signals for Bitcoin emerge

At the beginning of 2026, the global market experienced a widely overlooked yet highly influential change — the total US debt soared to $38.5 trillion, reaching a record high. This data not only broke records but also reignited discussions in the market about the dollar system, interest rate policies, and the long-term value of alternative assets such as Bitcoin.

Data shows that approximately 70% of current US debt is held by domestic investors, with the remainder mainly coming from foreign creditors such as Japan, China, and the UK. Looking at the debt scale alone does not fully reflect the risk; the key is its comparison to the economic size. Currently, the US GDP is about $30 trillion, which means the debt-to-GDP ratio has exceeded 120%, equivalent to “every $100 of economic value created, $120 of debt is carried.”

This round of debt surge mainly stems from extraordinary fiscal stimulus during the COVID-19 pandemic and sustained high spending on infrastructure, military, and social welfare over the past decades. More notably, the interest costs — the US government’s annual interest expenditure has exceeded $1 trillion, even surpassing the defense budget — which puts greater pressure on fiscal sustainability.

In such a high-debt environment, the market generally expects policy focus to shift from “anti-inflation” to “fiscal stability.” Historical experience shows that when debt pressure continues to rise, governments often promote rate cuts to reduce financing costs. Recently, several officials, including former Federal Reserve Chair Janet Yellen, have mentioned that “fiscal dominance” risks are increasing, meaning monetary policy may be forced to serve fiscal needs.

For the crypto market, this macro backdrop is usually seen as a positive. Low interest rate environments, a weakening dollar, and potential central bank asset purchases will all weaken the long-term purchasing power of fiat currencies, thereby increasing the attractiveness of inflation-hedging assets like Bitcoin and gold. Analysts point out that the US yield curve has become noticeably steeper, with short-term rates controlled and long-term yields rising. This structure, combined with structural weakness in the dollar, is more conducive to assets with “hard asset” characteristics.

Over the past year, the sharp rise in gold prices has reflected market concerns about currency devaluation. Analysts believe that Bitcoin is following a similar path to gold and is expected to gradually narrow the gap in future cycles.

In the context of high debt, potential easing policies, and long-term inflation expectations, the continuous expansion of US debt has become an unavoidable core variable in the medium- to long-term narrative of Bitcoin.