Ray Dalio: Bitcoin is a valid alternative to gold
Ray Dalio: Bitcoin is a valid alternative to gold

Ray Dalio: Bitcoin is a valid alternative to gold

By Eleonora Spagnolo - 9 Dec 2020

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Ray Dalio is talking about Bitcoin on Reddit again, sharing some positive comments.

In a series of tweets spread from his profile over the past few weeks, Ray Dalio asked about Bitcoin and said he might be missing something. In doing so, he expressed a number of doubts, including fears that it might be made illegal once it begins to become a competitor to fiat currencies. 

Without answering a specific question from someone who was asking if he had bought Bitcoin as a result of this tweet, Ray Dalio nevertheless addressed the issue, this time on Reddit.

Ray Dalio prefers gold to Bitcoin

To a user who asked if Bitcoin was the answer to the challenges that the current monetary system has caused, he replied:

“I think that bitcoin (and some other digital currencies) have over the last ten years established themselves as interesting gold-like asset alternatives, with similarities and differences to gold and other limited-supply, mobile (unlike real estate) storeholds of wealth. So it could serve as a diversifier to gold and other such storehold of wealth assets”. 

Therefore, the scepticism of the past weeks reveals an insight: Bitcoin is an interesting alternative to gold.

Ray Dalio continues:

“The main thing is to have some of these type of assets (with limited supply, that are mobile, and that are storeholds of wealth), including stocks, in one’s portfolio and to diversify among them. Not enough people do that”. 

That said, he prefers gold:

“As far bitcoin relative to gold, I have a strong preference for holding those things which central banks are going to want to hold and exchange value in when they are trying to transact”.

Basically, for the founder of Bridgewater Associates, Bitcoin is not a good investment at the moment as it is not yet accepted by central banks.

Central banks’ challenge for Bitcoin

Indeed, central banks seem to fear cryptocurrencies, so much so that their response to Bitcoin and stablecoins seems to be the issuance of CBDCs (Central Bank Digital Currencies). At the moment, Europe and the US are in the process of designing a digital state currency, while China seems to be one step away from its issuance.

Certainly, digital state currencies cannot be compared to Bitcoin for a very simple reason: state currencies will be strongly centralized, while Bitcoin is designed to be decentralized (and pseudo-anonymous). 

Its use would also be different, since central bank digital currencies would be nothing more than a digital reproduction of paper money. Their use would therefore only be that of a means of payment, while Bitcoin, as confirmed by Dalio himself, has now become a store of value.

Eleonora Spagnolo

Journalist passionate about the web and the digital world. She graduated with honours in Multimedia Publishing at the University La Sapienza in Rome and completed a master's degree in Web and Social Media Marketing.

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