The US Treasury will soon run out of money

America is one of the hottest topics of conversation right now. It doesn’t happen often, but governments can go bankrupt too. The US national debt is huge, but at the same time interest rates are very high. The U.S. Budget Office believes that the U.S. will not be able to pay its debts in the first two weeks of June.

The US government is close to bankruptcy

A Report The Congressional Budget Office (CBO) writes that the shortfall will be about $1.5 trillion ($1,500 billion) by 2023. That’s 0.1 trillion more than expected earlier this year. Unfortunately, it’s not just a lack of cash, it’s also close to the debt ceiling. This is a limit set by the US Congress on how much debt the federal government can borrow. Raising this level is controversial as debt is part of the public sector.

If the debt ceiling is not raised, the government agency thinks there is a high chance of defaulting on domestic debt by June. This means that the finance ministry cannot refinance the loan.

That refinancing now has to be done at very high interest rates because the Federal Reserve has allowed interest rates to rise so fast. So credit is very expensive. CBO hopes for a small breathing space to 2024. Revenue growth is expected next year.

National Debt Continues to Grow: Good for Bitcoin?

Unfortunately, the share of debt held by the U.S. government itself is unlikely to decrease in the coming years. This area will account for 98% of US gross domestic product (GDP) by the end of 2023, but by 2033 it will already be 119%. That would be the highest level of US national debt. Still, relatively speaking, it’s not too bad. For example, in Italy the ratio is 135.5% and in Japan it is 237.1%.

The hope is that this will benefit Bitcoin (BTC) and other cryptocurrencies, as in theory it will lead to higher inflation. After all, Bitcoin was created after the credit crisis of 2008, in which there were fears that the US government would cause hyperinflation by printing them.