US Debt Hit $40 Trillion. So Where Is Bitcoin’s Debasement Trade?

US federal debt has crossed $40 trillion. The government is still running a deficit close to 6% of GDP. Long-term borrowing costs remain high.

Yet Bitcoin is trading near $80,000, roughly 37% below its record high from last year.  That creates an awkward question for one of Bitcoin’s oldest macro narratives.

If rising debt and weaker fiat money are supposed to make scarce assets more valuable, why has Bitcoin spent much of 2026 falling? Analysts at BloFin argue that it’s about how the debasement trade is changing.

Its latest report finds that the trade has entered a “second phase.” Investors are now watching government attempts to control borrowing costs as closely as money creation itself.