Elon Musk, the Tesla billionaire who recently campaigned in support of U.S. president-elect Donald Trump, has been issuing warnings about a potential "financial emergency" on the horizon.
Musk's concerns about the U.S.'s growing $35 trillion debt have intensified as the price of Bitcoin continues to rise, while Dogecoin—a meme-based cryptocurrency—has seen even greater gains, fueled by Musk’s endorsement of the "Department of Government Efficiency," often referred to as Doge.
Musk expressed his concerns on X, the social media platform he acquired and rebranded from Twitter, stating, "Excess government spending is driving America into bankruptcy." He further added, "This debt growth is unsustainable."
Musk's comments were in response to Kentucky Senator Rand Paul, a supporter of Bitcoin, who had described the "status quo of $2 trillion annual deficits" as "unsustainable."
Paul garnered attention in 2015 when he became one of the first presidential candidates to accept Bitcoin donations for his Republican White House campaign, a move later adopted by Donald Trump and several other 2024 candidates. In a 2021 interview, Paul also suggested that cryptocurrency could eventually replace the U.S. dollar, citing waning confidence in the currency and growing government surveillance as key factors driving the shift.
According to Coingecko data, the total value of the cryptocurrency market has surged past $3 trillion, surpassing its previous pandemic-era peak. This comes despite public interest in crypto remaining significantly lower than the levels seen in 2021.
A brief market dip this morning had little impact on Bitcoin, which remains near its recent high of just under $90,000. The price briefly dropped to $85,000 before recovering to over $87,000.
Meanwhile, Dogecoin has surged by 36% in the past 24 hours, as traders place big bets on the influence of Tesla billionaire and Dogecoin supporter Elon Musk on U.S. president-elect Donald Trump. This rally has far outpaced Bitcoin's more modest 7% gain.
"Dogecoin is even more actively destroying skeptics with open positions," said Alex Kuptsikevich, chief market analyst at FxPro, in emailed comments. "In 24 hours, it soared 44% to $0.4. It traded sustainably higher for only 15 days in May 2021. This area was pivotal in April and June that year, so it’s worth paying extra attention to it this time around as well."
Meanwhile, U.S. national debt has surged in recent years, surpassing the $34 trillion mark at the start of 2024. The rapid increase is largely attributed to COVID-related stimulus measures and lockdown spending, which sent inflation soaring and forced the Federal Reserve to raise interest rates at an unprecedented pace.
Earlier this year, Trump suggested that he could use Bitcoin to address the U.S. national debt, stating, "pay off our $35 trillion—hand them a little crypto check, right? We'll hand them a little bitcoin and wipe out our $35 trillion."
In July, during an appearance at the Bitcoin 2024 conference, Trump further fueled speculation by promising to establish a "strategic national bitcoin reserve" and predicting that Bitcoin could surpass gold's $16 trillion market capitalization.
Musk’s advocacy for reducing U.S. spending has sparked calls for the creation of the Doge Department of Government Efficiency, a proposal Musk believes could cut $2 trillion from the federal budget.
The department’s name is a reference to the Shiba Inu doge meme, which is also associated with the Dogecoin cryptocurrency—Musk’s "favorite" crypto and one accepted as payment by his Tesla company.
This connection has led to a sharp rise in Dogecoin’s value, which has more than doubled in the past month. Billionaire Mark Cuban even jokingly suggested that Musk could one day place Dogecoin in the U.S. Treasury.
(Source: Forbes)
BD-Pratidin English/Mazdud
