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In a recent interview with the Economic Times, billionaire investor and founder of Bridgewater Associates, Ray Dalio, acknowledged the potential of digital assets, especially Bitcoin, emphasizing their impressive performance over the past decade.
Dalio: Bitcoin Still Has Unresolved Issues
72-year-old American investor also noted that Bitcoinâs finite supply makes it similar to other universally accepted inflation hedges such as gold.
However, he doesnât see central banks adopting Bitcoin as a reserve asset due to several issues such as privacy and ban in some countries.
âStill, there are issues with them. Transactions can be traced so privacy is an issue. They can be controlled, they can be shut down, they can be made illegal which tends to tap in during times when they may be threats to the alternative currency. So, I donât think theyâll be held as central bank reserves for various reasons,â he said.
Ray Dalio. Source: Yahoo
Not a Good Competitor Against Gold
While Dalio believes investors should have digital assets like Bitcoin in their portfolio, he noted that gold does a better job at hedging against inflation.
He also argued that Bitcoinâs total market value is less than that of Microsoft, which makes it less desirable for storing wealth compared to gold.
The billionaire, however, expressed optimism about the growth of the crypto industry over the next 10 years.
âI think that the environment that weâre in is an environment in which there is a risk of political confiscation or any other forms of confiscation. I think gold does a better job but as I said, weâre into this new environment and that could include NFTs and all sorts of things. Itâs a competitor but I think in terms of its qualities, not as good a competitor⊠But weâll figure those things out. It will evolve over the next 5 to 10 years,â Dalio said.
The Need for Diversification
The billionaire investor pointed out that due to the changing global economic environment, it would be wise for investors to diversify their investment portfolios. He commented that every investor should have crypto, gold, and other traditional assets in their portfolio to strengthen them against raging inflation.
âI think itâs a mistake for anybody to have just one, such as picking a digital currency and not having any gold or just having gold and not having any digital currency.â
Earlier this year, Dalio argued that people are giving too much attention to cryptocurrencies after admitting that Bitcoin has proven itself in its 13 years of existence.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.