How $31 Trillion in US Treasury Bonds Could Shape Crypto Markets in 2025
US Treasury plans to issue over $31 trillion in bonds this year—around 109% of GDP and 144% of M2. This would be the highest recorded level of bond issuance in history. How will it impact the crypto market? Heavy supply may push yields higher, as Treasury financing needs outstrip demand. Higher yields increase the opportunity …
US Treasury plans to issue over $31 trillion in bonds this year—around 109% of GDP and 144% of M2. This would be the highest recorded level of bond issuance in history. How will it impact the crypto market?
Heavy supply may push yields higher, as Treasury financing needs outstrip demand. Higher yields increase the opportunity cost of holding non‑yielding assets like Bitcoin and Ethereum, potentially drawing capital away from crypto.
US Bonds Might Add to the Crypto Market’s Volatility
The whole narrative potentially boils down to foreign demand for US bonds. Overseas investors hold roughly one‑third of US debt.
Any reduction in appetite—whether due to tariffs or portfolio rebalances—could force the Treasury to offer even steeper yields. Rising yields tend to tighten global liquidity, making risk assets like cryptocurrencies less attractive.
US Debt Issuance Ratio. Source:
X/Binance Research
When yields climb, equities and crypto can face selling pressure. For example, during the 2022 bond sell‑off, Bitcoin fell more than 50% alongside Treasury yields spiking. A repeat scenario could test crypto’s appeal.
Meanwhile, the US dollar’s strength could compound headwinds. As yields rise, the dollar typically gains. A stronger dollar makes Bitcoin’s USD‑denominated price more expensive for overseas buyers, dampening demand.
Yet crypto offers unique attributes. In periods of extreme monetary expansion, such as post‑pandemic, investors turned to Bitcoin as an inflation hedge.
Even if higher yields curb speculative flows, crypto’s finite supply and decentralized nature may sustain a baseline of buyer interest.
Technically, Bitcoin’s correlation to yields may weaken if Treasury issuance triggers broader macro volatility. When bond markets are hit by trade or fiscal policy shocks, traders may turn to digital assets to diversify since they don’t move in step.
However, that thesis hinges on continued institutional adoption and favorable regulation.
5/ What This Means for CryptoPersistent upward pressure on rates from Treasury supply could weigh on risk assets—crypto included. However, if the government eventually turns to debt monetization—essentially printing money to fund deficits—it could strengthen the case for…
— Binance Research (@BinanceResearch) April 18, 2025
Crypto’s liquidity profile also matters. Large bond sales often drain bank reserves—tightening funding markets.
In theory, tighter liquidity could boost demand for DeFi protocols offering higher yields than traditional money markets.
Overall, record US debt supply points to higher yields and a stronger dollar—volatility for crypto as a risk asset.
Yet crypto’s inflation‑hedge narrative and evolving technical role in diversified portfolios could temper volatility. Market participants should watch foreign demand trends and liquidity conditions as key indicators for crypto’s next moves.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Economic Truth: AI Drives Growth Alone, Cryptocurrency Becomes a Political Asset
The article analyzes the current economic situation, pointing out that AI is the main driver of GDP growth, while other sectors such as the labor market and household finances are in decline. Market dynamics have become detached from fundamentals, with AI capital expenditure being key to avoiding a recession. The widening wealth gap and energy supply are becoming bottlenecks for AI development. In the future, AI and cryptocurrencies may become the focus of policy adjustments. Summary generated by Mars AI This summary was generated by the Mars AI model, and its accuracy and completeness are still in the process of iterative improvement.

AI unicorn Anthropic accelerates IPO push, taking on OpenAI head-to-head?
Anthropic is accelerating its expansion into the capital markets, initiating collaboration with top law firms, which is seen as an important signal toward going public. The company's valuation is approaching 300 billions USD, and investors are betting it could go public before OpenAI.
Did top universities also get burned? Harvard invested $500 million heavily in bitcoin right before the major plunge
Harvard University's endowment fund significantly increased its holdings in bitcoin ETFs to nearly 500 million USD in the previous quarter. However, in the current quarter, the price of bitcoin subsequently dropped by more than 20%, exposing the fund to significant timing risk.

The Structural Impact of the Next Federal Reserve Chair on the Cryptocurrency Industry: Policy Shifts and Regulatory Reshaping
The change of the next Federal Reserve Chair is a decisive factor in reshaping the future macro environment of the cryptocurrency industry.

