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In summary
- Ray Dalio warned of a looming debt crisis in the US and China, calling it unsustainable.
- He recommended betting on “sound money” such as Bitcoin and gold in the face of high levels of inflation.
- He compared BTC to gold, highlighting its potential to outperform the precious metal in the future.
Billionaire hedge fund manager Ray Dalio says a debt crisis is looming in major economies—and that “sound money” like Bitcoin and gold is a safer bet.
Speaking at Abu Dhabi Finance Week, the Bridgewater Associates founder revealed he wants to “move away” from bonds and debt.
Dalio warned that the “unprecedented levels” of debt in the US and China are unsustainable.
“There is no way these countries can avoid having a debt crisis in the coming years,” he said Tuesday.
Inflation has remained stubbornly high in several major countries, eroding the purchasing power of currencies such as the dollar and pound. In 2022, the consumer price index reached highs of 9.6% in the UK and 9.1% in the US.
Meanwhile, Bitcoin—with its fixed supply of 21 million coins—recently accelerated to new all-time highs above $100,000.
Gold prices have also reached record levels in recent months, rising 36% in the last year to reach $2,697 per ounce. In fact, gold set a new all-time high in August. Then it did it again a few months later in October, when the price rose to $2,790.07 per ounce.
Enthusiasts have long described BTC as “digital gold,” while predicting that this Cryptocurrency will be more popular than the precious metal one day.
Surpassing gold’s $18 trillion market capitalization would result in a value of $850,000 per Bitcoin, with BitWise Asset Management predicting this milestone could be reached by the end of the decade.
Dalio added that investors should “think more about the bigger forces” at play on the world stage, rather than fixating on the “day-to-day headlines.”
He identified debt as one of those forces—along with domestic politics, geopolitics, “acts of nature” like climate change, and new technologies.
The 75-year-old investor has an estimated net worth of $14 billion, and established acclaimed asset manager Bridgewater Associates in 1975.
Dalio’s views on Bitcoin have evolved somewhat in recent years.
Previously, Dalio described this digital asset as “a small thing that gets disproportionate attention.”
“It’s not cash, it’s not an effective store of value, it’s not an effective medium of exchange, but we’re in a world where money as we know it is in danger. We’re printing too much,” Dalio told CNBC in February 2023. .
While he argued at the time that digital currencies could address the growing global debt crisis, he expressed doubts about whether Bitcoin was a solution.
Edited by Stacy Elliott.
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