Elon Musk warns of U.S. 'bankruptcy' as bitcoin and dogecoin spark $3 trillion surge

Tesla billionaire Elon Musk, who recently joined U.S. president-elect Donald Trump on the campaign trail, has issued warnings about an impending "financial emergency."

Musk’s concerns over the U.S.'s escalating $35 trillion debt coincide with a surge in bitcoin’s value, outpaced by the rapid rise of dogecoin, a meme-based bitcoin competitor that has gained traction with Musk’s support for the Department of Government Efficiency, known as Doge.

As speculation grows over whether Trump might consider using bitcoin to “wipe out” U.S. debt, Musk has labeled the national debt increase as "unsustainable."

"Excess government spending is driving America into bankruptcy," Musk posted to X, the social media platform he purchased and rebranded from Twitter, adding: "This debt growth is unsustainable."

Musk was responding to Kentucky senator Rand Paul, a bitcoin advocate, who called the “status quo of $2 trillion annual deficits unsustainable.”

In 2015, Paul made headlines by accepting bitcoin donations for his Republican presidential campaign, and in 2021, he stated in an interview that he believed crypto could eventually replace the U.S. dollar due to diminishing confidence in the currency and growing government surveillance.

The U.S. national debt has surged in recent years, crossing $34 trillion at the start of 2024, primarily driven by Covid-era stimulus measures that led to rampant inflation and forced the Federal Reserve to implement historically high interest rate hikes.

Earlier this year, Trump hinted at the idea of using bitcoin to "pay off our $35 trillion—hand them a little crypto check, right? We'll hand them a little bitcoin and wipe out our $35 trillion," he remarked.