U.S. Debt Crisis: Crypto’s Biggest Threat in 2026

This maturity wall, as experts call it, forces the Treasury to refinance at today’s higher interest rates. This is far from the low-cost era when much of this debt originated.

This setup could ripple through markets, including crypto. Picture the U.S. as a borrower who locked in cheap loans years ago. Now, those loans come due, and new ones cost more. Interest payments balloon, putting strain on budgets and shaking economic confidence.
No one discusses it much, yet it looms like a storm cloud over everything from stocks to digital assets.

The Looming $9 Trillion Debt Wall

The Looming Debt WallAt its core, this issue stems from how the U.S. manages its borrowing. Treasury notes and bonds are IOUs the government issues to fund operations. Many were sold during low-interest periods, like post-2008 or the pandemic, when rates hovered near zero.

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To put it simply, refinancing involves issuing new bonds to pay off old ones. But higher rates could push annual interest costs toward $1.5 trillion by the end of the decade, eclipsing spending on defense or social programs. A real-world example underscores the risk: During the 2022 inflation fight, the Federal Reserve hiked rates aggressively.

This tightened liquidity, or available cash in the system, and contributed to a sharp market downturn.Ripple Effects on Crypto and MarketsThis debt challenge does not stop at traditional finance; it hits crypto hard.

Crypto Faces Volatility Amid Rising Treasury Yields

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