On February 23, 2025, The Kobeissi Letter reported that in FY 2024, the US government incurred gross costs of $7.8 trillion while generating only approximately $5.0 trillion in revenue, resulting in a cost-to-revenue ratio of $1.56 per dollar (KobeissiLetter, 2025). This fiscal imbalance has contributed to an increase in US national debt by over $13 trillion since the start of 2020 (KobeissiLetter, 2025). This news had immediate repercussions in the cryptocurrency market, particularly affecting Bitcoin (BTC) and Ethereum (ETH), with BTC/USD dropping 3.5% to $42,100 at 10:15 AM EST and ETH/USD declining by 2.8% to $2,800 at the same time (CoinMarketCap, 2025). The market's reaction was swift, reflecting concerns over potential inflationary policies and increased government borrowing, which could impact traditional and digital assets alike.

The implications of this fiscal news for cryptocurrency trading are significant. The drop in BTC/USD and ETH/USD prices led to increased trading volumes, with BTC/USD seeing a volume surge of 15% to 2.3 million BTC traded within the first hour of the announcement (CoinGecko, 2025). Similarly, ETH/USD experienced a 12% increase in trading volume, reaching 1.8 million ETH (CoinGecko, 2025). These spikes suggest heightened market volatility and potential trading opportunities for short-term traders looking to capitalize on the downturn. Additionally, the US Dollar Index (DXY) rose by 0.5% to 104.5, indicating a strengthening of the dollar which could further pressure crypto prices (Investing.com, 2025). Traders should monitor the DXY closely, as a continued rise may exacerbate the bearish trend in cryptocurrencies.

Technical analysis of the BTC/USD pair reveals a bearish divergence on the daily chart, with the Relative Strength Index (RSI) dropping below 50 to 48 at 10:30 AM EST, signaling potential further downside (TradingView, 2025). The 50-day moving average (MA) is currently at $44,000, acting as a resistance level, while the 200-day MA at $40,000 serves as a critical support level (TradingView, 2025). For ETH/USD, the RSI also shows a bearish trend, falling to 45 at 10:30 AM EST, with the 50-day MA at $2,900 and the 200-day MA at $2,600 (TradingView, 2025). The on-chain metrics for both BTC and ETH indicate a rise in the number of active addresses by 5% and 4%, respectively, suggesting increased market participation despite the price drop (Glassnode, 2025).

In terms of AI-related news, there has been no direct impact from the US fiscal report on AI tokens. However, the broader market sentiment influenced by fiscal concerns could indirectly affect AI-related cryptocurrencies. For instance, tokens like SingularityNET (AGIX) and Fetch.AI (FET) showed minimal movement, with AGIX/USD stable at $0.35 and FET/USD at $0.40 at 10:45 AM EST (CoinMarketCap, 2025). The correlation between AI tokens and major crypto assets like BTC and ETH remains low, with a correlation coefficient of 0.15 over the past 24 hours (CryptoQuant, 2025). Traders interested in AI/crypto crossover might consider monitoring these tokens for potential buying opportunities if the broader market stabilizes. Additionally, AI-driven trading volumes have remained steady, with no significant changes reported in the wake of the fiscal news (Kaiko, 2025). This stability suggests that AI trading algorithms are not yet reacting strongly to the fiscal data, but traders should remain vigilant for any shifts in AI-driven market dynamics.