Bitcoin Facing American Debt: A Bulwark Against Currency Devaluation?

An Out-of-Control American Debt Questioning the Role of the Dollar

The numbers are staggering. The U.S. federal debt has reached $39.4 trillion, an increase of $3.2 trillion over the last twelve months. Since 2020, it has grown by $16.3 trillion, averaging $209 billion per month.

The cost of servicing this debt is becoming problematic. The U.S. Treasury now spends $24 billion every week just to pay the interest, a figure that has surged by 13% year-on-year. In the first nine months of fiscal year 2026, these interest payments total $939 billion, exceeding the budget of the Department of Defense.

The Penn Wharton model estimates that beyond 210% of GDP, U.S. debt becomes mathematically unsustainable. According to their projections, this ceiling could be reached as early as 2045 in an unfavorable scenario. Historically, authorities have had only one discreet exit: inflation.

The M2 Money Supply, a Thermometer Few Look At

To understand the devaluation of a currency, one must look at the M2 money supply. This indicator aggregates circulating bills, demand deposits, and easily mobilizable savings. In simple terms, it is the total amount of dollars available in the economy.

When M2 increases faster than the production of goods and services, each existing dollar mechanically loses value. This is the very principle of monetary dilution. Since 2020, the U.S. M2 has experienced historic expansion to finance pandemic-related stimulus plans and to absorb successive budget deficits.

The result is reflected in purchasing power. Between 2008 and 2021, the U.S. dollar lost about 30% of its purchasing power while Bitcoin appreciated by several orders of magnitude. This erosion is not an accident; it is a structural consequence of modern fiat monetary systems.

Bitcoin, a Scarcity Programmed by Code

In the face of this theoretically limitless monetary expansion, Bitcoin (BTC) presents a radically different model. Its supply is capped at 21 million units, a figure embedded in the protocol since its creation in 2009. This scarcity is neither negotiable nor modifiable without massive consensus from the network.

The halving mechanism reinforces this dynamic. Every 210,000 blocks, or approximately every four years, the reward given to miners is halved. The rate of issuance thus slows predictably until it ceases around the year 2140. This deflationary architecture contrasts with the programmed inflation of fiat currencies.

The price of Bitcoin partially reflects this dynamic. After hitting a record of $126,195 in October 2025, BTC is currently trading around $62,494. Volatility remains real, but the underlying trajectory aligns with global monetary expansion.

Digital Gold, a Thesis Gaining Ground

Bitcoin shares several characteristics with gold, its elder among stores of value. Scarcity, resistance to censorship, absence of a central issuer: these properties have earned it the nickname digital gold. It even offers some practical advantages such as extreme divisibility, with one bitcoin divisible into 100 million satoshis, and ease of cross-border transfer.

A mathematical model developed by researchers from the universities of Liverpool and Tufts formalizes this thesis. They demonstrate that if the inflation rate r sustainably exceeds the real growth rate g, the price of Bitcoin theoretically tends toward infinity relative to the dollar. With inflation at 5% and growth at 2%, BTC would mechanically gain 3% annually against the greenback, solely due to dilution.

The mathematical demonstration does not exempt important nuances. Bitcoin remains a volatile asset, capable of brutal corrections of 50% or more. Over short horizons, it does not behave like a classic safe haven.

The thesis of Bitcoin as a protection against currency devaluation does not make BTC a guarantee, but a coherent hypothesis in a context of record sovereign debt and continuous expansion of the money supply.