Elon Musk Proposes Dogecoin Strategy to Boost U.S. GDP Amid 43% Recession Risk

Elon Musk has unveiled a strategy to bolster U.S. GDP growth as a means to address rising national debt and recession fears. His plan involves leveraging the cryptocurrency Dogecoin (DOGE) to stimulate economic activity and mitigate the impacts of increasing Treasury yields, tariffs, and market volatility. This initiative comes at a time when the U.S. economy is grappling with several challenges, including rising Treasury yields and the implementation of tariffs on imported goods.

Treasury yields in the United States have surged, with the 10-Year Treasury yield reaching 4.5%. This spike has heightened concerns about an economic slowdown, with the probability of a U.S. recession now at 43%. These factors have contributed to increased market volatility. Additionally, tariff threats have added to economic uncertainties. On May 23, 2025, a proposed 50% tariff on European Union goods led to a decline in Bitcoin prices and unsettled global markets. The ongoing tariff uncertainty continues to disrupt global trade and unsettle investors.

Despite the market uncertainty, Musk’s Tesla remains bullish on Bitcoin, holding around $1.25 billion in the asset. This demonstrates Musk’s confidence in Bitcoin, despite market fluctuations. However, the broader market's reaction to tariffs highlights the risks they pose to both traditional and digital assets. U.S. Treasury Secretary Scott Bessent has expressed support for measures to boost the economy rather than reduce spending. According to Bessent, stabilizing the U.S. financial situation requires economic growth to outpace debt accumulation, indicating a shift in focus towards growth rather than austerity.

Federal Reserve Bank of Chicago President Austan Goolsbee anticipates potential interest rate cuts within the next 10 to 16 months. Musk’s efforts to address economic challenges could significantly influence the future direction of the U.S. economy. The proposed strategy aims to counteract the economic headwinds posed by the current administration's policies, which include significant tariffs and other measures that could potentially hinder economic growth. Musk's plan to boost GDP growth through the use of DOGE is seen as a creative solution to these challenges, although its effectiveness remains to be seen, as the use of cryptocurrencies in economic policy is still a relatively new and untested area.