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The U.S. government paid over $100 billion in interest in a single October month. This is roughly four to five times the usual amount, which analysts consider a major problem. This figure is historically high and shows that the era of nearly cost-free borrowing is definitively over. What are the consequences for the Bitcoin price?
Cheap Debt Rolls Over into a More Expensive World #
For more than ten years, the U.S. financed itself with short-term debt at (near) zero percent interest. As long as rates remained low, this barely impacted the budget. But since the Federal Reserve raised the policy rate to between 3.75 and 4.00 percent, that old, cheap debt is starting to mature. Refinancing is now happening at much higher rates.
October has historically been a month with many coupon payments, causing interest costs to shoot up immediately. Coupon payments are the fixed interest payments that governments and companies make to bondholders. According to analysts, this is not a temporary peak but the beginning of a longer period in which borrowing becomes increasingly expensive.
folks…. pic.twitter.com/sQQ84HC6vw — zerohedge (@zerohedge) November 25, 2025
Economy Weakens #
This rising interest burden coincides with a broader weakening of the economy. The signs are piling up: subprime borrowers are once again massively falling behind on payments, office real estate is facing record problems. Moreover, specialized lenders are collapsing and banks are further tightening the credit tap.
At the same time, the number of corporate bankruptcies is rising to the highest level in fifteen years, oil prices are falling below $60. This is a sign of waning demand. Additionally, the bond market is showing more and more warning signals.
All of this is not coming together by chance: it fits a phase in which a long period of monetary tightening turns into actual economic damage.
A Gigantic Debt Wall Comes into View #
The total U.S. debt has now risen to $38 trillion. An unusually large portion of this must be renewed in the short term. Within one year alone, $11 trillion must be rolled over. In 2025, another heavy blow follows, as more than 20 percent of all outstanding Treasuries will mature.
By 2028, 61 percent of all U.S. debt must be renewed. In total, this amounts to about $28 trillion in just four years. This is one of the largest repricing waves ever. A repricing wave means that existing debts must be reissued at the then-current (often higher) interest rates. The enormous mountain that must be refinanced coincides with a weakening economy, which only increases the financial risks.
What Are the Consequences for Bitcoin? #
The consequence is clear: the current interest rate is too high for both the private sector and the government. As soon as unemployment moves towards 5 to 6 percent, the Fed will no longer take time for small adjustments. Then a real interest rate cutting cycle of possibly 200 to 300 basis points will follow.
That movement is already underway:
- two interest rate cuts in September and October,
- end of QT on December 1,
- and a new purchase program from December 11.
- Analysts expect another cut, despite internal Fed dispute.
For Bitcoin, this would be a good thing. The cryptocurrency really needs the support of the U.S. central bank, because at the moment there is clearly too little liquidity (capital) in the financial system to push prices up. If things don’t change quickly, then this bull market is over.