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Forbes: US $39 Trillion Debt "Crisis" Could Trigger Bitcoin Price Surge

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The US dollar is currently experiencing sustained depreciation, leading to concerns that this may escalate into a complete collapse, thereby boosting the prices of gold and Bitcoin.

Original Title: U.S. Dollar “Collapse”—A $39 Trillion Debt “Crisis” Is Quietly Predicted To Trigger A Huge Bitcoin Price Boom To Rival Gold

Original Author: Billy Bambrough, Forbes
Translated by: AididiaoJP, Foresight News

Since the U.S. launched a war against Iran, Bitcoin has surged by 30% (there are currently two major shocks driving Bitcoin's price upwards).

However, the Bitcoin price is still far from its historical high of $126,000 in 2025, despite U.S. Defense Secretary Pete Hegseth stating that China is secretly hoarding Bitcoin.

Now, as traders prepare for the “upcoming” White House Bitcoin move, billionaire legend Ray Dalio has warned that the U.S. dollar is on the brink of collapse, while a JPMorgan analyst predicts funds will rotate en masse from gold to Bitcoin.

The U.S. dollar is facing ongoing devaluation, with some concerned that this could escalate to a complete collapse—thus boosting gold and Bitcoin prices.

“The U.S. is now spending $7 trillion a year with revenues of around $5 trillion, so spending is 40% more than income,” said Ray Dalio, founder of the world's largest hedge fund, Bridgewater Associates, on The New York Times podcast “Interesting Times.”

“This deficit has been going on for some time, so its debt is about six times its revenue. Historically, such a situation causes problems.”

May 11 Update: Following reports of U.S. national debt exceeding 100% of Gross Domestic Product (GDP), Mark Goldwein, Senior Vice President at the Committee for a Responsible Federal Budget, warned that the U.S. is entering a debt spiral.

“When that happens, at some point you're caught in this debt spiral,” Goldwein told The New York Times. “The only way to stop it is through some kind of systemic large shock.”

Meanwhile, the Congressional Budget Office (CBO) revealed last week that the U.S. Treasury has already paid $628 billion in net interest for debt this year.

“Net interest on the public debt rose by $41 billion (or 7%), as the debt size was larger through the first seven months of fiscal year 2025 and long-term interest rates were higher. The decline in short-term rates partly offset the overall increase in interest payments,” the CBO stated.

The price of gold, after dropping to $4,000 per ounce in April, has seen a rebound in recent weeks, with analysts pointing to inflationary pressures and a debt spiral as reasons for its rise.

“High inflation, ever-growing sovereign debt, and ongoing global uncertainty continue to enhance gold's appeal. The market doesn't need new catalysts—the existing catalysts have always been there,” said Max Baecker, President of American Hartford Gold (AHG), in a comment via email.

In recent years, due to large-scale government spending during the COVID-19 pandemic and lockdowns, U.S. debt has skyrocketed, with the rapid rate hikes to curb inflation further adding to the servicing cost of the $39 trillion debt pile.

“So when we look back in history, we see in all such periods, all fiat currencies depreciate, while gold rises,” Dalio said, noting that gold is currently the “second-largest reserve currency for central banks.”

When asked about the economy heading towards a “crisis and breakdown,” Dalio stated that a future “financial crisis will mean that the spending capacity is very limited,” adding that he “doesn't think any fiat currency will be an effective store of wealth.”

Dalio's warning coincides with the views of J.P. Morgan analyst, who believes that “the debasement trade is transitioning from gold to bitcoin.”

Gold prices have doubled over the past two years, rising alongside silver, as traders bet on sustained inflation and Fed money printing leading to dollar debasement and dilution.

In a report seen by The Block, J.P. Morgan analysts led by managing director Nikolaos Panigirtzoglou stated that they saw Bitcoin (referred to as “digital gold” due to its capped supply and immutability) surpassing gold as a debasement trade tool post-Iran conflict, as Bitcoin ETF inflows exceeded those of gold ETFs.

In March this year, billionaire investor Stanley Druckenmiller predicted that the dollar would no longer be the world's reserve currency in 50 years—potentially replaced by bitcoin or cryptocurrency.

“We are doing our best to destroy it,” Druckenmiller said, possibly referring to the soaring U.S. budget deficit, which he previously referred to as a “debt bomb.” The dollar “may outlive me, but I doubt whether it will still be the reserve currency in 50 years.”

Druckenmiller called the dollar “the cleanest dirty shirt” and stated he doesn't know what might replace the dollar as the world's reserve currency, but it could be “some kind of crypto thing I don't like,” consistent with his initial prediction made in 2021.

Moreover, Tesla billionaire Elon Musk has also (repeatedly) predicted the end of the US dollar, sparking speculation that he is preparing for a major Bitcoin move.

Musk warned that the world is heading towards a post-fiat era, claiming that "energy is the real currency," which has led to speculation among Bitcoin supporters that he is quietly backing cryptocurrency.

At the same time, former Federal Reserve Chair Janet Yellen warned that U.S. President Donald Trump may be pushing the dollar into "hyperinflation," with some believing this scenario could trigger a Bitcoin price surge.