Bitcoin Nears All-Time High After Rapid U.S. Debt Expansion Fuels Crypto Surge
Bitcoin hovers near its all-time high following an overnight rally that also propelled ether to levels not witnessed since 2021. As of writing, the price of bitcoin stands 1% higher at $119,782, as per Coin Metrics data. Ether, on the other hand, has dipped approximately 1.6%, settling at $4,181 after a surge on Sunday to its peak since December 2021. It crossed the $4,000 mark for the first time since December last Friday.
These movements coincide with a rise in U.S. equity futures as investors gear up for crucial inflation reports. The stock market is poised to touch new highs.
Coinbase shares have gained more than 3% in pre-market trading. Galaxy Digital, a bitcoin proxy, has risen by 3%, while Strategy, another digital asset investment firm, has advanced over 2%. Mining companies such as Mara Holdings, Riot Platforms, and Iren have also seen gains of more than 3%.
The crypto surge is primarily attributed to buying during Asia’s trading hours, driven by the rapid expansion of U.S. debt, according to Markus Thielen, CEO of 10x Research. He notes that bitcoin’s breakout from its “consolidation” in early July coincided with President Donald Trump signing the Big Beautiful Bill, which included a $5 trillion debt ceiling increase.
“Bitcoin’s breakout isn’t random; it’s being fueled by the fastest U.S. debt expansion in history, and this momentum is not waning,” Thielen said. “Whether the economy remains robust or dips into recession, the flood of new debt acts as a tailwind for hard assets like bitcoin and gold.”
He further suggests that the next significant resistance level at $133,000 is now within reach, with market dynamics favoring bullish sentiment.
Simultaneously, stocks associated with ether’s price have rallied. The surge in inflows into the recent crop of treasury companies has pushed the price of the second-largest cryptocurrency above $4,000 – a historically challenging level for investors psychologically and technically.
Shares of Bitmine Immersion Technologies are up around 11%, while SharpLink Gaming has gained 3%. Last week, ether ETFs attracted greater inflows ($326.83 million) than bitcoin ETFs ($246.75 million), according to SoSoValue.