US Congress Passes $5 Trillion Debt Ceiling Hike Bill, Bitcoin Gains Expected

On July 3, the US Congress passed the One Big Beautiful Bill Act, a controversial piece of legislation that significantly increases the US government’s borrowing ability. The bill, proposed by President Donald Trump, was passed along partisan lines with only two Republicans voting against it. The bill has drawn significant criticism from Democrats and even from current and former Trump allies like Tesla CEO Elon Musk.

Notably absent from the bill were proposed amendments to the cryptocurrency tax code. As the bill worked through the Senate, lawmakers attempted to tack on a number of provisions regarding crypto, but to no avail. Crypto tax service Crypto Tax Made Easy had noted clauses in the bill that would redefine rules around airdrops, smooth out reporting requirements for staking and create better de minimis exceptions, making it easier to spend crypto without triggering a taxable event. Senator Cynthia Lummis also suggested an amendment that would remove the “double tax” on Bitcoin miners, but these provisions did not make it into the final draft.

Despite the lack of specific crypto provisions, market observers are optimistic about the knock-on effects it will have for Bitcoin (BTC). According to analysts, the bill's hike of the national debt ceiling by $5 trillion could lead to a significant price spike for Bitcoin. Crypto analyst Ranjay Singh said that, while there may be hills and valleys in the short term, “More debt can lead to more money printing. That’s good for BTC in the long run.” Nigel Green, CEO of advisory firm deVere Group, also noted that markets have already begun to respond, with long-term yields creeping up and assets like gold and Bitcoin rising on renewed fears about the erosion of purchasing power.

However, the bill and the potential Bitcoin gains may come at a greater cost to the world economy. The bill introduces a number of tax cuts for the US’s wealthiest and aims to offset these significant tax reductions and increased government spending with cuts to critical benefits programs like the Supplemental Nutrition Assistance Program and Medicaid, as well as income from tariffs. Some countries are expecting letters from the Trump administration announcing 20%-30% hikes in tariffs. Green warned, “This bill throws open the taps on spending while throttling the flow of global goods. It’s a high-stakes gamble with inflation — and one that the rest of the world will end up paying for.”

Trump is set to sign the bill into law on July 4, the US’s Independence Day. While the world economy and Medicaid recipients are bracing for the impact of the Big Beautiful Bill, pro-crypto lawmakers in Washington are already busy. On July 3, Lummis introduced a solo bill to address her qualms with the tax code for miners. The bill also contains a de minimis exemption for digital asset transactions and capital gains of $300 or less, with an annual cap of $5,000. Meanwhile, House Finance Committee Chair French Hill, House Agriculture Committee Chair Glenn Thompson and Speaker Mike Johnson announced that the week of July 14 would be “Crypto Week,” during which they aim to pass three separate bills related to the crypto industry.