At the Bitcoin 2025 conference, Lyn Alden delivered a comprehensive, data-driven presentation highlighting the increasingly uncontrollable state of the U.S. financial system and emphasizing Bitcoin’s growing significance amid these challenges. She pointed out that despite a decline in the unemployment rate, the U.S. fiscal deficit has surpassed seven percent of GDP, marking a continuous rise since 2017, with an accelerated increase during the pandemic period. Alden argued that this trend signifies a fundamental shift rather than a temporary anomaly, indicating a financial framework devoid of effective brakes or stabilizing mechanisms.
Alden further explained how this fiscal environment exerts upward pressure on asset prices, particularly those of scarce and valuable resources. She analyzed the inverse relationship between real interest rates and gold prices, noting that gold tends to appreciate as real yields decline. Contrary to earlier expert opinions—five years ago suggesting Bitcoin would struggle in a high interest-rate environment—Bitcoin’s price has surged past $100,000, with gold also maintaining elevated levels, even as financial institutions face mounting stress.
Highlighting the post-2008 surge in public debt relative to private sector borrowing, Alden described this as a pivotal turning point. She also emphasized that rising interest rates are paradoxically increasing federal interest payments rather than curbing deficits, thereby intensifying pressure on the financial system. Alden likened this dynamic to a Ponzi scheme, dependent on continuous growth, where any halt would equate to systemic collapse.
Her presentation illustrated a persistent upward trajectory in the ratio of total debt to base money supply, with only temporary setbacks following the 2008 financial crisis and the 2020 pandemic shock. The overall trend remains firmly upward, underscoring Bitcoin’s role as a contrarian asset due to its scarcity, decentralization, and mathematically enforced supply cap. Alden concluded that the debt cycle can only be halted by two forces: mathematical constraints and human nature, positioning Bitcoin as both a reflection of this system and its most effective safeguard.
Source: bitcoinmagazine
