The world's total debt has surpassed $300 trillion, with about a third coming from government borrowing (according to the IIF). Simply put, the planet now owes itself $300 trillion.
But who's going to pay that bill? Every human on Earth? Or maybe Jupiter and Saturn will chip in? And what if no one is willing — or able — to pay at all?
History shows that when debt becomes unbearable, nations inevitably face defaults, hyperinflation, repression, and even wars.
The #1 problem of the fiat–credit system is its chronic debt growth.
When people, companies, and governments borrow too much, the economy may appear strong — temporarily. After all, the money is being spent today. But eventually, that debt must be repaid, forcing spending cuts that lead to slowdowns, recessions, and crises.
Credit creates the illusion of growth that is, in truth, nothing more than an advance taken from tomorrow — plus interest.
Credit is the exchange of present pleasure for future pain.
Citizens of countries with rising public debt experience a "budget squeeze": the more money goes toward interest payments, the less remains for roads, schools, and healthcare — while taxes, fees, and tariffs keep climbing.
Interest payments have become as essential a budget item as doctors' salaries — except this one grows on its own, without society's consent.
As public debt grows, it becomes harder for a country to attract foreign investment, while domestic borrowing costs rise. Markets demand higher yields — and with them come higher mortgage and business loan rates.
It's becoming increasingly difficult for young people to buy homes, and for companies to expand.
A debt spiral is a situation in which a country, company, or individual is forced to take on new loans just to repay old ones. It's a vicious cycle where each new loan only delays — but never solves — the problem.
The #2 problem of the fiat–credit system is ever-rising inflation.
When a government finances its spending through debt, it inevitably faces a choice: to borrow in its own currency or in a foreign one.
If the debt is denominated in its own currency, the government can repay its obligations by issuing new money. Formally, this solves the problem — but it expands the money supply without creating real value, fueling inflation
If the debt is in a foreign currency, exchange rate risk arises: to repay it, the government must buy foreign currency, weakening its own. This leads to devaluation and higher prices on imports.
In the end, both scenarios lead to the same outcome — a constant rise in inflation.
The fiat system cannot escape this cycle without destroying itself. It was designed to ensure stability and promote growth — but in reality, it merely postpones the inevitable, shifting the consequences into the future. Each new cycle of debt and money printing may look like salvation, but in reality, it only makes things worse — turning a "temporary fix" into a chronic disease that future generations are left to pay for.
Currency and debt must remain a reliable store of wealth — otherwise they will be devalued and abandoned.
The price every reader of this article pays
When governments live on debt, everyone ends up paying — through three main mechanisms:
Taxes
It's no secret that the main source of income for any government is taxation. When public debt rises, the government is forced to raise taxes. For citizens, this means smaller paychecks, higher prices for goods and services, and rising costs of energy and fuel.
The art of taxation consists in plucking the goose so as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.
Inflation
Inflation becomes the second tool for extracting wealth from the population. When debt grows too large, it becomes convenient to let prices rise — because old debts are repaid with money that's already lost its value. For the government, it's a relief; for the people, it's a decline in their quality of life.
Simple arithmetic shows that inflation is far more devastating than any tax ever enacted by legislators. The 'inflation tax' has a marvelous ability to simply destroy capital.
Wars and revolutions
When debt burdens become unbearable, history shows that the only remaining escape often comes through war or revolution.
The American Revolution (1775–1783), the French Revolution (1789–1799), the Russian Revolution (1917), World War II (1939–1945), the Yugoslav Wars (1991–1995) — all erupted amid financial strain and a crisis of confidence in currencies.
Armed conflict becomes a way to erase debt, distract the population, and restart the system through destruction.
But the cost of these "solutions" is always borne by ordinary people. They lose their homes, their families, their familiar world.
For the state, every war is a system reboot — for the individual, it's the end of everything they loved.
I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.
Redistribution of trust: from fiat to source code and crypto
Public debt doesn't grow because of a single "bad government" — it's embedded in the very mechanics of the fiat–credit system. This model is designed in such a way that the conflict between citizens and the state, between nations and their rivals, never truly disappears — it's merely postponed until the next crisis cycle.
The fiat–credit economy is built on debt, inflation, and the belief that there will always be buyers for government bonds — and that fiat money will retain its value. But that trust is slowly fading. We've entered an era in which society is shifting its faith from centralized, inflationary currencies to open-source code and cryptocurrencies.
Deflation is the opposite of inflation. While inflation makes money lose value, deflation makes it grow in worth. That's the core idea behind the DeflationCoin cryptocurrency.
We're not building a continuation of the outdated fiat–credit system — we're building its alternative. Because we genuinely believe that every person deserves a choice.
Every complex system feeds on the stability of another. When the underlying structure becomes fragile, the collapse of the upper level is inevitable — even if it appears unexpected.
Bitcoin rose precisely because the fiat–credit system proved fragile. DefCoin will be the next step — not a protest against the old world, but a logical response to its very laws.
If even 1% of the $300 trillion debt market flows into DefCoin — holders will be truly happy.