$36T US Treasury debt ceiling signals Bitcoin correction as soon as Trump is in office

Source Cryptopolitan

The US treasury is expected to surpass its $36 trillion debt ceiling, a problem that President Trump may have to face on his first day in office. As a result, Bitcoin may experience a temporary correction to $70,000 before its next surge in the market cycle.

The crypto market is experiencing a surge fueled by Trump’s inauguration. It was expected.

Biden’s administration has seen debt numbers rise from $28 trillion to more than $36 trillion, growing by over $8 trillion in just three years. Just this year, the debt has increased by over $2 billion. 

In a letter published on January 17, Treasury Secretary Janet Yellen declared a “debt issuance suspension period” will commence on January 21 and continue until March 14. 

This nearly two-month suspension of debt issuance could indicate a decrease in global liquidity. It also means a warning sign for Bitcoin price action. Bitcoin reached a new all-time high above $109,000 on Jan. 20, but it seems like this excitement will not be outlived.

Bitcoin and the American debt 

During previous debt ceiling negotiations, Bitcoin showed inconsistent connections with standard market liquidity measurements. 

This time, Alvin Kan, chief operating officer of Bitget Wallet, said that volatility in traditional markets may spill over into the crypto market. He stated, “It could lead to a broader market risk-off environment, potentially impacting Bitcoin negatively. The outcome would largely depend on investor behavior, economic policy responses, and global financial sentiment.”

While traditional markets are expected to limit liquidity, Marcin Kazmierczak, co-founder and chief operating officer of Redstone, believes the debt ceiling will have a mixed influence on Bitcoin prices. In fact, he suggested that investors may begin to perceive BTC as a protective measure against monetary instability.

Global liquidity is anticipated to increase following March 14. This will be a positive indicator of Bitcoin’s price trend throughout the remainder of 2025.

Meanwhile, the Bitcoin whale MicroStrategy is exploring another share expansion model to generate additional capital for further Bitcoin purchases. In fact, The company’s Bitcoin position has increased by a remarkable $19.055 billion as a result of the $28.179 billion spent and the methodical dollar-cost averaging into BTC. MicroStrategy’s BTC holdings are valued at $47.234 billion as of today.

Crypto to assist the American debt 

According to the most recent reserve reports, Tether and Circle’s dollar-backed stablecoins contain over $95 billion in treasury notes. 

Tether’s report indicates that the stablecoin issuer maintains $84.548 billion in government debt. Treasury bill holdings amount to $11.127 billion, according to Circle’s November 12 report, which was obtained from BlackRock.

The consistent demand for treasury bills could absorb American debt as stablecoins continue to develop. This could provide a fiat on-ramp to traders and encourage crypto adoption.  

The rise of stablecoin issuers as buyers of treasury bills lessens the reliance on traditional buyers and eases worries that their holdings will drop due to global uncertainty. Stablecoins may serve as an alternative to stabilize the situation. This could hold until additional measures are implemented to alleviate the crisis. 

A Step-By-Step System To Launching Your Web3 Career and Landing High-Paying Crypto Jobs in 90 Days.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Is the Crypto Rally Dead? Why Bernstein Still Predicts a $150K Bitcoin Peak Despite Waller’s WarningsFed Governor Waller claims the crypto craze has faded, while Bernstein backs Bitcoin to reach $150,000 this year.On Tuesday (February 10), the cryptocurrency market remained sluggish; wit
Author  TradingKey
6 hours ago
Fed Governor Waller claims the crypto craze has faded, while Bernstein backs Bitcoin to reach $150,000 this year.On Tuesday (February 10), the cryptocurrency market remained sluggish; wit
placeholder
Gold Price Forecast: XAU/USD falls below $5,050 as traders await US jobs data Gold price (XAU/USD) attracts some sellers near $5,035 during the early Asian session on Tuesday. The precious metal edges lower amid improved risk sentiment and some profit-taking. Traders brace for key US economic data later this week, including delayed employment and inflation reports. 
Author  FXStreet
15 hours ago
Gold price (XAU/USD) attracts some sellers near $5,035 during the early Asian session on Tuesday. The precious metal edges lower amid improved risk sentiment and some profit-taking. Traders brace for key US economic data later this week, including delayed employment and inflation reports. 
placeholder
Bitcoin Reclaims $70,000. Cathie Wood Claims Near Potential Bottom, Will This Time Be Different?Bitcoin price rebounds above $70,000; Cathie Wood calls a "potential bottom" again, but the reality may differ.On Monday (February 9), Bitcoin ( BTC) price momentum has stalled, fluctuati
Author  TradingKey
Yesterday 10: 37
Bitcoin price rebounds above $70,000; Cathie Wood calls a "potential bottom" again, but the reality may differ.On Monday (February 9), Bitcoin ( BTC) price momentum has stalled, fluctuati
placeholder
A Crash After a Surge: Why Silver Lost 40% in a Week?TradingKey - Spot Silver ( XAGUSD) prices have continued to decline; on Thursday, silver plummeted as much as 20% to break below $71 per ounce, and on Friday the sell-off intensified as prices fell fu
Author  TradingKey
Feb 06, Fri
TradingKey - Spot Silver ( XAGUSD) prices have continued to decline; on Thursday, silver plummeted as much as 20% to break below $71 per ounce, and on Friday the sell-off intensified as prices fell fu
placeholder
Bitcoin is trading around $63,000, down nearly 40% from its peak near $126,000Wall Street desks are no longer talking about upside dreams. The talk right now is how far Bitcoin charts could fall if selling keeps piling up. According to data from TradingView, Bitcoin’s price now sits at a shocking $63,500, after falling from $70,000 just this morning, losing $13,000 in 6 days, and staying far below […]
Author  Cryptopolitan
Feb 06, Fri
Wall Street desks are no longer talking about upside dreams. The talk right now is how far Bitcoin charts could fall if selling keeps piling up. According to data from TradingView, Bitcoin’s price now sits at a shocking $63,500, after falling from $70,000 just this morning, losing $13,000 in 6 days, and staying far below […]
goTop
quote