Larry Fink warns about the US debt that threatens the dominance of the dollar, with interest payments soon surpassing military spending. He warns that this fragility opens the door to alternatives like Bitcoin.
The CEO of BlackRock, Larry Fink, sounds the alarm in his annual letter to investors: the status of the dollar as the world’s reserve currency is more threatened than ever. Faced with soaring public debt, digital assets — Bitcoin in particular — could soon emerge as a credible alternative to American hegemony.
The historical dominance of the dollar in jeopardy
There is no guarantee that this will last.
For decades, the dollar’s position as the linchpin of the global financial system has provided the United States with a unique strategic advantage: capital attractiveness, unlimited low-cost financing, and geopolitical influence. But Larry Fink warns that there are no guarantees.
The cause is the American public debt, which has been growing three times faster than GDP since the late 1980s. By 2025, interest payments on the debt alone will surpass military spending. By 2030, they could absorb all tax revenues.
Bitcoin, a credible alternative to the dollar
Larry Fink does not hide his admiration for digital assets. He speaks of “an extraordinary innovation” that makes markets faster, more transparent, and cheaper. But he warns: this same innovation could erode the economic advantage of the United States if investors perceive Bitcoin as a more reliable store of value than the dollar. The irony is palpable: the man at the helm of one of the world’s most powerful asset managers has himself catalyzed this shift.
IBIT: the record-breaking Bitcoin ETF
Launched by BlackRock, the IBIT fund has become the largest ETF launch in history in less than a year. It now weighs over 50 billion dollars, with 37.4 billion flowing in 2024 alone. It outperforms all competition, including Fidelity. A sign of the times: more than half of the investors are individuals, and nearly three-quarters had never invested in an iShares product before. Fink admits:
If everyone allocated just 2 to 5% of their assets to Bitcoin, its price could someday reach $700,000.
Tokenization, the next market revolution
For Larry Fink, the real revolution goes beyond Bitcoin: it’s called tokenization. Transforming every stock, bond, or tangible asset into a digital token would eliminate the frictions of the current financial system. No more market closures, no more settlement delays: transactions would happen in seconds. This would free up billions of dollars currently tied up, injecting them immediately into the real economy.
But most importantly, tokenization democratizes investment: fractional ownership, easier access to assets once reserved for the ultra-rich, direct voting rights for shareholders. “It’s like going from postal mail to email,” summarizes Fink.
A vision between technological optimism and economic realism
Despite the uncertainties and anxieties prevailing in the markets, Fink remains confident. The history of financial markets is marked by crises followed by resilience. But this time, the turning point is more structural than cyclical. The dollar is on the line. And Bitcoin is no longer just an alternative: it is a credible threat to the established order.
