A recent trip to Greece was a reminder of just how differently a country’s finances can play out. Everyday costs there were surprisingly affordable compared to the US — a legacy, in part, of the severe debt crisis Greece went through starting in 2009. Years of heavy borrowing, bailouts, tax hikes, and austerity measures culminated in a government default in 2015. Retirement benefits were cut repeatedly, unemployment topped 25%, taxes roughly doubled, homelessness climbed, and reports of food insecurity and rising rates of suicide and attempted suicide followed.
Why was it so severe? Greece joined the Eurozone in 2001, which meant it gave up the ability to “inflate away” its own debt. A country operating on its own currency can ease a debt burden through inflation — at the real cost of its citizens’ purchasing power — but it can avoid the kind of acute shock Greece experienced. As a Eurozone member, Greece instead received bailouts from the IMF, but at the cost of severe austerity measures that triggered significant unrest and economic pain.
How This Relates to the US
The United States, like most developed nations throughout modern history, tends to manage rising debt loads — from wars, crises, and other spending pressures — through its central bank, using inflation to reduce the real cost of that debt over time.
That dynamic has been on clear display recently. Post-pandemic, the federal government distributed roughly $814 billion in direct payments to individuals, the Federal Reserve’s balance sheet swelled to roughly $7.3 trillion through quantitative easing, and businesses received substantial support through Employee Retention Credits (estimated at $230 billion and rising) and PPP loans (roughly $757 billion). For scale, the Fed’s balance sheet is now equivalent to about 26% of the roughly $27.36 trillion US GDP for 2023.
More recently, the Inflation Reduction Act added an estimated $800 billion in government spending over ten years, and a federal student loan forgiveness program — introduced in 2024 after an earlier version was struck down by the Supreme Court in 2023 — carries cost estimates ranging from $870 billion to $1.4 trillion.
With that scale of spending, the inflation the country has experienced in recent years is easier to understand. The people hurt most by rising costs — groceries, gas, housing — tend to be the people who can least absorb it.
This is part of why real estate has endured as a means of building and preserving wealth over time: property values are closely tied to inflation (housing costs make up roughly a third of the CPI), which helps make real estate a physical hedge against the erosion of purchasing power.
What About Cryptocurrency?
On paper, a decentralized digital currency has real appeal. Cryptocurrencies like Bitcoin are designed to be deflationary or have controlled inflation mechanisms — Bitcoin has a capped supply of 21 million coins, in sharp contrast to fiat currencies, which central banks can print in unlimited quantities. That scarcity and transparency is exactly what prevents arbitrary increases in supply — and inflation.
It’s also exactly why a truly global, consistent cryptocurrency is unlikely to be widely adopted by governments: the ability to manage an economy by adjusting a central bank’s balance sheet is a tool most governments are reluctant to give up.
Why Governments Are Hesitant to Embrace Crypto
Cryptocurrencies have surged in popularity over the past decade, promising a decentralized financial future. But despite growing adoption among individuals and businesses, governments worldwide remain cautious — largely because of what it would mean for their ability to manage national debt.
Inflation and debt management: Inflation reduces the real value of money over time, which can work in a government’s favor when it carries substantial debt. At moderate levels, inflation lowers the real burden of that debt without reducing the nominal amount owed — a subtler, less politically costly tool than raising taxes or cutting spending outright. If a government owes $1 trillion and inflation runs at 5% annually, the real value of that debt erodes meaningfully over time.
Sovereignty and monetary policy control: Control over the national currency is core to a country’s economic independence. Central banks rely on monetary policy — including quantitative easing during downturns, injecting liquidity by purchasing government securities — to stabilize the economy, manage inflation, and influence employment. A decentralized cryptocurrency would make these tools far less effective, since governments and central banks would have little ability to control supply or distribution. If Greece had retained that kind of monetary flexibility, its recession likely would have been far less severe.
The Bottom Line
Because governments worldwide rely on the ability to manage their economies — for stability and, often, political reasons — widespread global adoption of cryptocurrency as a primary currency would be a genuinely difficult shift. Operating within one’s means and maintaining a more limited currency supply would arguably be healthier, but it’s not the direction most governments are likely to move in voluntarily. That’s a big part of why cryptocurrency adoption as a true worldwide currency looks unlikely at scale, at least for now.
One practical note for investors holding both asset classes: the IRS allows crypto losses to be deducted against other capital gains — so if you’re selling real estate for a gain, losses from selling cryptocurrency can help offset that gain. And if you’re looking for an inflation-resistant place to put capital long-term, real estate remains one of the more enduring options.
