Elon Musk Warns U.S. Debt Interest Imperils Spending; Bitcoin Solutions Proposed

Elon Musk has warned about the mounting U.S. national debt, stating that interest payments consume 25% of all government revenue. In a on X, he expressed concern that if current deficit spending rates continue, the federal government will soon find itself unable to fund anything beyond these debt interest obligations.

According to Musk, this fiscal trajectory threatens essential programs such as Social Security, Medicare, and national defense. He described the situation as a tipping point, saying, “There will only be money for interest payments and nothing else.”

Musk’s warning comes as the U.S. national debt nears $37 trillion. Interest on this debt exceeds $100 billion each month, totaling roughly $1.2 trillion per year. Official figures also show a budget deficit of over $2 trillion and total federal spending surpassing $7.1 trillion.

The debt crisis has intensified amid rising interest rates, making servicing the debt significantly more expensive. As a result, interest payments are eating up a growing share of government revenue, leaving less room for core public services and infrastructure.

In a separate post, financial analyst Geiger Capital also commented on the issue by offering a time-based analogy to emphasize the scale of the national debt. The post noted that the U.S. is currently adding $1 trillion in new debt every 180 days.

In response, Musk intensified his stance, that the country is on a path toward “debt slavery” if current spending trends are not curbed.

Economists and policy experts have long cautioned that rising debt levels could hinder the government’s ability to manage future economic downturns or respond to emergencies. With interest payments rising and deficits widening, the risk of crowding out essential public spending grows stronger.

Amid the precarious situation of the U.S. economy, proposals have emerged that Bitcoin could be a solution.

Matthew Sigel, Head of Digital Asset Research at VanEck, had earlier BitBonds. This hybrid financial instrument aims to help the U.S. manage its $14 trillion debt. The product would allocate 90% of investor funds to safe Treasury bonds and 10% to Bitcoin.

The U.S. government would purchase BTC with the raised capital, allowing investors to earn all crypto gains up to 4.5% annually, with any additional profits split evenly with the government. Sigel argues that this structure protects against inflation and aligns incentives between the public and the state.

In April, Andrew Hohns, CEO of Newmarket Capital, a similar concept. It suggested issuing $2 trillion in bonds, with $200 billion invested in Bitcoin and the rest used for federal operations. Offered at a 1% interest rate, well below the 4.5% Treasury benchmark, this plan could save the government $554 billion after accounting for BTC costs. He noted that if Bitcoin’s historical growth continues, the government’s holdings could exceed $50 trillion by 2045.

Meanwhile, Senator Cynthia Lummis the BITCOIN Act on March 6, pushing for a strategic reserve of 1 million BTC to help stabilize the national debt. According to the senator, Bitcoin is the only solution to U.S. debt.