[U.S. Debt Nears $40 Trillion, Investors Turn to Bitcoin and Gold to Hedge Against Dollar Depreciation] BlockBeats News, July 27: As U.S. government debt continues to climb, investors are refocusing on scarce assets like Bitcoin and gold, viewing them as tools to hedge against the declining purchasing power of the dollar. According to U.S. Treasury's 'Debt to the Penny' data, as of last Friday, U.S. federal debt had reached a record $39.7 trillion. Some market participants have pointed out that U.S. government debt is currently increasing by approximately $7 billion per day, and when calculated by market value, this growth exceeds the scale of most crypto assets. The founder of LondonCryptoClub stated that the rapid growth of U.S. debt is driving the so-called 'currency depreciation trade,' where investors purchase assets with limited supply, such as gold and Bitcoin, to mitigate the long-term depreciation risks of fiat currencies. The organization believes that in a 'fiscal dominance' environment, Federal Reserve policies may be influenced by government financing needs, requiring interest rates to remain low while continuing to provide liquidity to assist with debt refinancing. Apollo Chief Economist Torsten Slok previously warned that the U.S. debt-to-GDP ratio has exceeded 120%, leaving limited room for fiscal stimulus during future economic recessions. Meanwhile, the Federal Reserve may find it difficult to implement significant rate cuts as it has in the past, since rate cuts could exacerbate inflation and lower Treasury yields, thereby impacting government financing. Currently, Bitcoin's price remains above $65,000, supported by eased U.S.-Iran tensions and falling oil prices, which have improved market risk appetite. At the same time, Ethereum has recently outperformed Bitcoin, with the ETH/BTC exchange rate breaking above the 100-day and 200-day moving averages. The market believes that the altcoin rally may be heating up. However, analysts have noted that since its inception in 2010, Bitcoin's price movements have more closely resembled those of tech stocks rather than traditional safe-haven assets, and its hedging properties remain a topic of debate. [Original Link]