On May 16, 2025, credit agency Moody’s downgraded the United States’ long-held Aaa sovereign credit rating to Aa1, citing the nation's ballooning debt and persistent fiscal deficits (Bloomberg). This follows earlier downgrades by S&P in 2011 and Fitch in 2023, marking the first time the U.S. has lost its top-tier rating across all three major credit rating agencies.
The downgrade comes amid rising concern over the U.S. federal debt, which now exceeds $36 trillion (Cointelegraph). Analysts warn that the move could increase U.S. borrowing costs and place further pressure on debt markets (The Guardian).
In the face of this fiscal instability, Bitcoin has gained renewed attention as a hedge. The price of BTC remained stable above $104,000 despite the Moody’s announcement, suggesting that some investors are beginning to view Bitcoin as a safe-haven alternative amid weakening confidence in government-backed assets (Investing.com).
This shift reflects growing interest in decentralized financial systems, especially during periods of macroeconomic uncertainty.
