Bitcoin Holds Near $65K as US Debt Nears $40T

Bitcoin traded near $65,000 while U.S. gross federal debt reached $39.489 trillion on July 15, about $511 billion short of $40 trillion. The Treasury will publish a revised estimate for July-to-September borrowing on Aug. 3 and release the full quarterly refunding package, with auction sizes and financing details, on Aug. 5.

The Treasury currently expects to borrow $671 billion in privately held net marketable debt during the July-to-September quarter. That estimate is based on an assumed Treasury General Account cash balance of $950 billion at the end of September. The Treasury General Account held about $795.98 billion on July 15, roughly $154 billion below the quarter-end target, meaning borrowing to reach the target would first raise the account balance before those funds leave the account through government spending.

The $39.489 trillion figure records obligations already outstanding. Quarterly borrowing estimates reflect the government’s next funding needs but do not equal the gross debt total because gross debt also changes with maturities, intragovernmental flows, cash movements and changes in the Federal Reserve’s holdings.

A larger borrowing estimate would increase the volume of government securities that private investors must absorb. Heavier issuance of long-duration coupon-bearing notes would add duration exposure to the market. Buyers of Treasury paper may demand higher yields or fund purchases by drawing on bank deposits or selling other assets.

Federal Reserve research published in May found that a one-percentage-point rise in expected U.S. debt relative to GDP is associated with an increase of roughly 2 to 3 basis points in the 10-year Treasury term premium. Market yields in mid-July provided notable contractual returns: the two-year yield was about 4.16%, the 10-year around 4.57%, and the 30-year near 5.09%. Reports noted oil-linked inflation concerns pushed the 10-year toward 4.6% on July 20.

Higher Treasury yields raise the opportunity cost of holding an asset that pays no coupon. A firmer dollar can reduce dollar liquidity in global markets. The Federal Reserve reported near-zero use of the overnight reverse repurchase facility on most days and about $3.1 trillion in reserves during the first half of 2026, reducing the pool of idle cash that often helps absorb short-term bill issuance.

U.S.-listed spot Bitcoin ETFs provided a direct source of demand during mid-July. The ETFs recorded net inflows of $500.2 million across four positive sessions from July 14 through July 17, reversing a $424.7 million outflow on July 13. Bitcoin reached $66,190 during that period, its highest level since June 17.

The Congressional Budget Office projects a $1.9 trillion federal deficit for fiscal 2026 and expects publicly held federal debt to reach about 120% of GDP by 2036. The Treasury’s Aug. 3 borrowing update and the Aug. 5 refunding package will set short-term issuance and financing details that market participants can use to assess near-term supply and demand for government securities and potential effects on yields, cash balances and dollar liquidity.