When the world's largest asset management company, BlackRock, rarely speaks bluntly, the market listens not to predictions but to declarations. In the latest institutional outlook report, BlackRock clearly pointed out that the U.S. federal debt surpassing $38 trillion will become a 'nuclear-level' catalyst for the next super cycle in cryptocurrency. This is not some KOL's call to action, but a systemic shift signal issued by a Wall Street giant controlling $10 trillion in funds.
$38 trillion in debt: an unavoidable 'gray rhino'
By October 2025, the total amount of U.S. national debt officially exceeds $38 trillion, equivalent to 123% of GDP. The terrifying aspect of this figure lies in its acceleration of growth—$10 trillion in new debt over the past five years, surpassing the total from the previous 20 years. Interest payments on the debt have exceeded the defense budget, becoming the third-largest expenditure for the federal government.
More seriously, this trend shows no signs of reversal. BlackRock states bluntly in its report: regardless of which party is in power, the debt problem will not disappear. Both parties, seeking votes, dare not touch voter welfare; tax cuts are easy, but cutting expenditures is hard, and the debt will only grow larger. This means that currency devaluation will become the "passive choice" for the US to avoid default.
When traditional safe-haven tools start to fail, global capital must seek new value anchors.
The "triple failure" of traditional hedging tools
BlackRock's analysis points out that under the shadow of $38 trillion in debt, three major traditional safe-haven assets are facing systemic challenges:
US Treasury bonds are losing their "risk-free" halo. As the sustainability of debt is questioned and foreign central banks continue to reduce their holdings, the risk of liquidity exhaustion in US Treasuries is rising. In October 2025, foreign capital's monthly reduction in US Treasuries reached a new high since 2020.
Gold volatility has soared. Under the support of geopolitical conflicts and central bank gold purchases, gold remains strong, but its price volatility has increased from an annual average of 10% to 25%, reducing hedging efficiency.
Stock market valuations are at historical highs. The overall valuation of US stocks has exceeded that during the dot-com bubble of 2000, with limited further upside and high sensitivity to interest rates.
In this context, the three major characteristics of cryptocurrencies are beginning to be recognized by institutions:
1. Non-sovereign asset attributes: Bitcoin's "digital gold" narrative is essentially a direct hedge against national fiscal credit risk. Its fixed supply mechanism of 21 million coins stands in stark contrast to the unlimited printing of dollars.
2. Strong correlation with global liquidity: The correlation coefficient between BTC and global M2 money supply is 0.85, accurately capturing liquidity changes. When debt expansion forces central banks to loosen, Bitcoin becomes the most direct "liquidity sponge."
3. Stablecoins build a bridge between fiat and crypto: Stablecoins like USDT and USDC have formed a "shadow dollar system" with a daily settlement scale of $500 billion. The BlackRock report emphasizes: "Stablecoins have moved beyond niche status to become a key bridge between traditional finance and digital liquidity."
The "flywheel effect" of stablecoin expansion: from $306 billion to $4 trillion
The core engine of this institutional super cycle is the exponential expansion of stablecoins. The current total supply of stablecoins is around $306 billion, while the shocking forecast number discussed internally at BlackRock is that by 2030, the stablecoin market size could reach $1.9 trillion (baseline scenario) and up to $4 trillion in an optimistic scenario.
This forecast is based on three major driving forces:
1. Issuance costs are approaching zero. After the adjustment of eSLR (Supplementary Leverage Ratio) rules, banks can purchase US Treasuries as stablecoin reserves without any additional capital. Circle has converted all reserves into short-term debt of 0-3 months, significantly reducing issuance costs.
2. Institutional Demand Explodes. BlackRock's BUIDL tokenization fund absorbed $500 million in one month, with total AUM approaching $2.9 billion, backed by JPMorgan's frantic purchasing. Goldman Sachs has listed "stablecoin-short debt arbitrage" as the juiciest trading desk for 2026.
3. The policy green light is fully turned on. The Trump administration is very likely to abolish SAB 121 and pass the stablecoin bill. This means that banks can issue and custody stablecoins with legitimacy, integrating them completely into the mainstream financial system.
When stablecoins expand from $306 billion to $4 trillion, it means that the leverage ceiling of the crypto market will be completely opened. DeFi, RWA, meme coins, Layer 2—all tracks will receive unprecedented liquidity irrigation.
Wall Street's early layout: institutions are already "strategically moving in the dark"
BlackRock's report is not just talk; it is itself a banner of this transformation:
• BTC ETF and ETH ETF have been approved by the SEC, cumulatively attracting over $50 billion in funds, of which 75% are new customers making their first purchases of iShares products.
• The BUIDL fund has become the largest tokenized US Treasury product, providing institutions with a compliant on-chain income source.
• Circle and Coinbase's alliance is constructing a complete loop of "stablecoin-payment-custody."
A trader working at Castle Hedge Fund privately revealed: "When yields drop below 3%, we will switch all client funds from short debt to crypto assets. This SLR loosening is permanent, not a temporary exemption."
This confirms the judgment of BlackRock CEO Larry Fink: Bitcoin has upgraded from a "speculative asset" to an "alternative asset in a portfolio," its positioning on par with gold.
Risks and Opportunities: The AB Side of the Super Cycle
However, this super cycle driven by debt is not a smooth path:
Risk 1: Regulatory Backlash. If the $4 trillion stablecoin impacts the traditional banking system, it is not ruled out that the SEC or FSOC (Financial Stability Oversight Council) will impose stricter capital adequacy requirements or even directly restrict bank participation.
Risk 2: Inflation Out of Control. Aggressive interest rate cuts stimulate demand, and if the supply side fails to respond in time, inflation may reignite. At that time, the Federal Reserve will be forced to make a sharp turn, and the crypto market will experience roller coaster-like volatility.
Risk 3: Technological Risk. Can DeFi protocol liquidation mechanisms withstand a 10-fold increase in leverage? Can on-chain settlement efficiency match that of traditional finance? These questions will face extreme testing in 2026.
Conclusion: The end of the debt crisis is the starting point for crypto.
The subtext of BlackRock's report is already very clear: the US debt crisis is no longer a "macro shadow" over cryptocurrency, but rather its "adoption accelerator." As the traditional financial system staggers under the burden of debt, crypto assets are upgrading from "alternative options" to "backup plans for the financial system."
The higher the debt, the more appealing crypto becomes; the more uncontrolled the debt, the more institutions need non-sovereign assets. This is not market hype, but Wall Street has turned on the tap and inserted the hose into the crypto market.
The crypto market in 2026 will witness a super cycle driven by institutional debt panic and stablecoin expansion. Bitcoin at $200,000, Ethereum at $20,000, Solana at $1,000—these seemingly exaggerated targets may become conservative estimates under the impact of the $4 trillion flood of stablecoins.
The real party is just about to start in 2026. But remember: in the liquidity feast, surviving is more important than making quick money. When everyone is celebrating, maintaining a clear mind is the ultimate wisdom to cross cycles. #USDebtCrisis #BlackRock #Stablecoins #Cryptocurrency #InstitutionalInvestment
Risk Warning: BlackRock's forecast is based on the current policy environment. If there are significant changes in regulatory policies or the macro economy, the speed of stablecoin expansion may not meet expectations. The cryptocurrency market is highly volatile; please assess risks carefully.#机构积极投资比特币ETF $BTC
