According to The Kobeissi Letter, credit markets are now pricing US credit as if it were rated BBB+, which is six notches below its official AA+ rating, and just three levels above non-investment grade status (source: The Kobeissi Letter, June 18, 2025). This repricing is evident in credit default swap (CDS) market data and reflects growing investor concerns over the US fiscal outlook. For cryptocurrency traders, this elevated perception of US credit risk could fuel volatility across crypto markets, as traditional investors may seek alternative assets like BTC and ETH during periods of financial instability. Monitoring the CDS spreads and their correlation with BTC price action can provide valuable trading signals.

According to Moody's, the US federal debt burden is projected to rise sharply to 134% of GDP by 2035, up from 98% in 2024, a level surpassing even the peak after World War II when it never exceeded 120%. Moody's further highlights that interest payments could consume approximately 30% of US government revenue if debt levels reach this high, compared to the current 18% (source: Moody's, 2024). This mounting fiscal pressure signals increasing macroeconomic risk and could drive institutional investors toward alternative assets like Bitcoin, Ethereum, and other cryptocurrencies, as investors seek hedges against sovereign debt risk and potential USD debasement. Traders should monitor US debt trends closely, as sustained fiscal deterioration may catalyze upward volatility in major crypto assets.