The U.S. National Debt Just Topped $40 Trillion. Here's What That Could Mean for Bitcoin.

It's possible, and even probable, that the climbing national debt of the U.S. will be a tailwind for Bitcoin (CRYPTO: BTC) over the long run.

As you may have heard, the Treasury Department recently said that the national debt was running at over $40 trillion as of Aug. 18. For the record, that's more than double its level in 2017.

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But Bitcoin's relationship with the national debt is not necessarily a tightly coupled one, as its price fell by 28% in the 12 months through Aug. 27, 2026, anyway. Two other debt-related metrics are needed to understand what's likely next for Bitcoin, so let's first take a look at them.

The deficit is becoming a bigger share of the economy

The national debt is the pool of liability that the U.S. has borrowed but has not yet repaid.

That debt is held across many different bonds and notes, with many different maturities and interest rates. So the total amount that's owed isn't a very meaningful number on its own, even if it sounds scary or onerous to repay. The more important factor is the debt-to-gross domestic product (GDP) ratio, which compares the size of the debt pile to the economy's output, the means to repay it.

The national deficit, on the other hand, is the annual shortfall between the government's revenue and its planned spending. The Congressional Budget Office (CBO) projected in February 2026 that this year's deficit would reach $1.9 trillion, or 5.8% of the country's GDP. It also estimates that debt held by the public will reach 101% of GDP this year, and then, assuming the trend doesn't change, 120% by 2036.

As that proportion increases, lenders will demand higher yields to compensate for the rising risk of default, making the problem worse over time.

The government has a few potential exits from this dilemma. It can try to:

Grow the economy faster than the debt pile.

Cut government programs to reduce spending and, in turn, slow down new borrowing.

Increase taxes to generate more revenue for debt service.

Inflate the currency so as to reduce the real value of the debt.

And it's that last bullet point that has major implications for Bitcoin.

Can more government borrowing send Bitcoin higher?

Bitcoin's 21 million coin supply cap makes it a candidate for being an investment that's resistant to inflation . Even if the money supply increases a lot due to money printing, it's not possible to print more Bitcoins.