As the global adoption of cryptocurrency continues to grow, a new concept of a government-issued Bitcoin Treasury bond is poised to enter the mainstream of securities. According to a recent study by the Bitcoin Policy Institute, a not-for-profit organization, the concept of BTC treasury bond can save the U.S. economy from trillions of dollars of debt.
So what exactly are Bitcoin Treasury bonds, and whether they can help economies amid rising threats of inflation and tariff politics-induced fear psychosis?
What are Bitcoin Treasury Bonds?
Bitcoin-Enhanced Treasury Bonds are envisioned as a hybrid security issued by the U.S. Treasury. Unlike standard Treasury bonds, which pay a fixed interest rate and return principal at maturity, these bonds would allocate a portion of their proceeds to purchase Bitcoin, while the remainder supports conventional government financing.
A prominent proposal from the Bitcoin Policy Institute suggests a structure where:
- 90% of the bond proceeds fund typical government operations or refinance existing debt.
- 10% of the bond proceeds are used to acquire Bitcoin, building a strategic Bitcoin reserve.
What are “₿ Bonds” or “BitBonds”?
₿ Bonds” or “BitBonds”) as an innovative fiscal tool to address multiple critical objectives.
“The Executive Order recognized bitcoin as a strategic reserve asset—akin to digital gold—and authorized the Secretaries of Treasury and Commerce to develop budget-neutral strategies for acquiring additional bitcoin without imposing costs on American taxpayers. The BitBonds program represents a direct implementation of this directive,” read a report from the Bitcoin Policy Institute.
The proposal suggests Bitcoin-Enhanced Treasury Bonds as a fresh solution to manage the U.S. national debt that reached $36 trillion early in 2025 through Bitcoin price growth potential.
The proposal originates from a purported executive order issued by Donald Trump during March 2025 which designated Bitcoin as digital gold and authorized fiscally sound Bitcoin expansion strategies for U.S. government holdings. The Strategic Bitcoin Reserve will maintain Bitcoin assets in secure multi-signature cold storage operated by the Treasury that serve as long-term value reserves rather than marketable assets.
The Bitcoin-Enhanced Treasury Bonds system uses Bitcoin historical growth patterns together with strategic debt refinancing techniques to reduce United States government debt obligations. Here’s how it might work:
According to the Bitcoin Policy Institute, the U.S. Treasury could launch $2 trillion in ₿ bonds to pay off $14 trillion in federal debt that expires during the following three years (as of 2025). The $2 trillion debt issuance would utilize $1.8 trillion to fulfill maturing debt obligations and dedicate $200 billion to Bitcoin buying.
The government would start saving on interest payments by offering ₿ bonds at a rate that is lower than conventional Treasury bond rates, for example, 1% instead of 4.5%. The use of $2 trillion in ₿ bonds could reduce federal expenses by $70 billion per year to the interest costs from regular Treasury bond issuance.
Conclusion
The Bitcoin-Enhanced Treasury Bonds take advantage of Bitcoin’s expansion prospects to obtain savings on debt refinancing expenses while creating a strong reserve asset. Through Bitcoin’s appreciation and interest savings, trillions could be extracted from the debt burden throughout decades even though the direct debt payment remains unchanged. The proposed model reveals a new trend for governments to include digital assets in their financial operations as protection against their regular fiscal problems.
Also read : Trump-Backed American Bitcoin Mining Venture To Go Public!
