Trump's unconventional plan to erase $35 trillion in debt

Former President Donald Trump suggested using bitcoin to eliminate the United States' $35 trillion national debt.

The US national debt continues to rise and the Republican presidential candidate has a bold idea to address the problem: giving bitcoin (btc) to China to pay off the US debt.

“Cryptocurrencies are a very interesting thing. They are very high-level in some ways, very high-level intellectually. But if we don’t do it, China will do it… maybe we’ll pay off our $35 trillion debt and give them a little crypto check, right?” Trump saying Fox News’ Maria Bartiromo: “We’ll give them some bitcoin and we’ll wipe out our $35 trillion.”

This bold proposal will spark widespread debate in the crypto space, but the feasibility of using cryptocurrencies to mitigate the country’s financial debt is not without its challenges.

The US government currently holds 210,392 Bitcoins, currently worth $13.3 billion, making the country one of the largest holders of the currency.

At the time of writing, bitcoin is trading near $63,000.

Trump's math: How the US can pay off its debt with bitcoin

Believe it or not, in a perfect world where price predictions come true, Trump could be right. Below are some recent bitcoin price targets set by major financial institutions:

Fundstrat Global Advisors estimates that bitcoin could reach $180,000 by the end of 2024, driven by the adoption of spot bitcoin ETFs. Standard Chartered has recently revised its year-end target from $100,000 to $120,000, citing increased institutional adoption and favorable market conditions.

Bernstein, an asset management firm with over $750 billion in assets, doubled down on its bold bitcoin price prediction, raising its 2025 target from $150,000 to $200,000. ARK Invest projects a long-term price target of $600,000 by 2030, emphasizing bitcoin as an inflation hedge and a store of value. Fidelity has been famous for its bitcoin-achieve-fidelitys-1-billion-by-2038-prediction” target=”_blank” rel=””>foretold that bitcoin could reach $1 billion by 2038.

In it Current bitcoin PriceThe United States would need approximately 555,555,600 bitcoin to pay off its debt.

In $180,000 For every bitcoin, the United States would need 194,444,000 bitcoin.

In $280,000 For every bitcoin, the United States would need 125,000,000 bitcoin.

In $600,000 For every bitcoin, the United States would need 58,333,000 bitcoin.

In $1,000,000 For every bitcoin, the United States would need only 35,000,000 bitcoin.

And if Fidelity's price prediction is correct and bitcoin reaches 1 billion dollars By 2038, the United States would only need 35,000 bitcoin.

While using bitcoin to erase national debt is intriguing, the feasibility of such an approach is dubious and depends on several economic and logistical challenges.

bitcoin's volatility, changing regulatory environment, and significant trading volume must all be taken into account. At the time of writing, Genesis Trading is beginning to sell its bitcoin to pay off debts, causing a large liquidation. Of course, the bitcoin supply is limited to 21 million coins, so many of the above scenarios represent unrealistic scenarios.

Currently, Trump's claim that a “small” amount of bitcoin could wipe out all of America's debt is premature, but if the U.S. continues to buy and accumulate bitcoin as its value continues to rise, perhaps the country could become debt-free, or at least gradually reduce the massive multi-trillion-dollar obligation.