Billionaire hedge fund manager Ray Dalio has admitted that he may be wrong about bitcoin after stating that governments will ban the cryptocurrency if it â€œbecomes material.â€ Dalio founded Bridgewater Associates; his hedge fund is the largest in the world.
Ray Dalio Open to Learning About Bitcoin
Bridgewater Associates founder Ray Dalio has admitted that he may be wrong about bitcoin after stating last week that he did not think that cryptocurrencies â€œwill succeed in the way people hope they would.â€ He further said that governments will outlaw bitcoin if it becomes material.
Dalio is an American billionaire hedge fund manager who founded Bridgewater Associates and has served as its co-chief investment officer since 1985. His hedge fund is the largest in the world, with about $140 billion in assets under management. Dalio has been called the â€œSteve Jobs of Investingâ€ by AICIO Magazine and Wired Magazine. He was also named one of the 100 Most Influential People by TIME Magazine.
As the price of bitcoin soared, surging about 55% over the past 30 days, Dalio tweeted on Tuesday:
â€œMy problems with bitcoin being an effective currency are simple,â€ he began to highlight his concerns in a series of tweets.
Firstly, he claimed: â€œBitcoin is not very good as a medium of exchange because you can[not] buy much with it (I presume thatâ€™s because itâ€™s too volatile for most merchants to use, but correct me if Iâ€™m wrong).â€
Secondly, he asserted: â€œitâ€™s not very good as a store-hold of wealth because itâ€™s volatility is great and has little correlation with the prices of what I need to buy so owning it doesnâ€™t protect my buying power.â€
Next, he reiterated the risk of governments banning bitcoin that he outlined in an interview with Yahoo Finance last week. Dalio said that if bitcoin â€œbecomes material, governments wonâ€™t allow it.â€ He emphasized: â€œtheyâ€™ll outlaw it and theyâ€™ll use whatever teeth they have to enforce that. They would say â€¦ you canâ€™t transact the bitcoin, you canâ€™t have a bitcoin.â€ The billionaire fund manager similarly tweeted Tuesday:
The Bridgewater Associates founder further argued that â€œunlike gold which is the third-highest reserve assets that central banks own, I canâ€™t imagine central banks, big institutional investors, businesses or multinational companies using it.â€
Dalio ended his series of tweets with â€œIf Iâ€™m wrong about these things I would love to be corrected. Thank you.â€
Bitcoiners Addressing Ray Dalioâ€™s Concerns
Many bitcoiners replied to Dalioâ€™s bitcoin tweets. While the comments varied, some people attempted to address Dalioâ€™s three concerns in detail. One of them was Blockfi CEO Zac Prince, who addressed each point Dalio made against bitcoin being an effective currency.
Founder of Mythos Capital Ryan Sean Adams chimed in, explaining that â€œBitcoin-like assets arenâ€™t meant to be a MoE, but a SoV to back digital stablecoins, similar to how gold once backed fiat.â€ Addressing Dalioâ€™s government ban concern, he simply stated that â€œGame theory forces central banks to hold it; MMT will forces CBs into the digital realm.â€
Capriole Investments founder Charles Edwards noted: â€œAll new asset classes start from 0. Starting from 0 means there will be volatility to get to a big number. But if you zoom out, put Bitcoin on a log chart, it is almost as close to a straight line up as you can get. Mediums of exchange take time to become accepted among the population. Fact: you can use bitcoin debit cards to buy goods anywhere globally.â€
Many replies simply point Dalio to their own work explaining about bitcoin or other popular resources. The official Twitter account of Fidelity Digital Assets wrote: â€œMr. Dalio â€” many of your concerns around bitcoin are what we discuss with institutional investors every day at Fidelity Digital Assets.â€
Some people see Dalioâ€™s comments as a sign that he personally or his hedge fund will soon buy bitcoin. Abra CEO Bill Barhydt tweeted: â€œAnyone want to take a bet that Ray Dalio does a 180 on bitcoin in the next 6 months or sooner?â€ Lark Davis, aka The Crypto Lark, wrote:
What do you think about Ray Dalioâ€™s view on bitcoin? Let us know in the comments section below.
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.