Forex in this article
Dalio: If Bitcoin becomes too successful, regulators will try to destroy it
There is no intrinsic value in Bitcoin, but it is useful
Ray Dalio has a small investment in Bitcoin
Ray Dalio once again warned of a violent end to Bitcoin. The famous investor, whose hedge fund Bridgewater Associates, with assets under management of more than 100 billion US dollars, is the largest hedge fund in the world, said in the spring that the largest cryptocurrency may soon be banned. Now Dalio followed up with a new warning at the SALT conference in mid-September.
Dalio Warns Against Bitcoin Destruction – SEC Sees Conditions As In ‘Wild West’
In an interview with CNBC, the hedge fund manager responded, “I think if it’s really successful they will eventually destroy it and they will try to destroy it. I think they will destroy it because they have the power to destroy it.” On the question of whether, in his opinion, regulation of the crypto sector will lead to the existence of a future for cryptocurrencies such as Bitcoin or their destruction.
The interview was preceded a day by statements from SEC President Gary Gensler, who, according to CNBC, spoke to the US Senate that the US financial regulator is fully working to better monitor Bitcoin and Ethereum and better regulate thousands to create new digital currencies and assets. “Currently, we do not have sufficient protection for investors who hold digital currencies in the financial sector, issuance, trading or lending,” Gensler said. The Securities and Exchange Commission chief said the entire sector is “like the Wild West.”
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Although the US stock exchange regulator argues that the planned regulation of cryptocurrency is to protect the interests of investors, according to Ray Dalio, the government does not want Bitcoin to become too successful in the mainstream. If so, he thinks it could quickly mean the end of the e-logo. However, the fact that El Salvador has accepted bitcoin as legal tender does not indicate that this will also happen in the US – because there are enough examples of countries where it works exactly the opposite. “There’s El Salvador accepting it, India and China getting rid of it. Then there’s the United States talking about how it’s regulated and it can be controlled,” said a famous investor.
Bitcoin as an alternative to cash and using diversification
According to Dalio, the fact that the government does not want altcoins does not mean that Bitcoin has no place or value and will therefore automatically fail. Although cryptocurrency has no intrinsic value, this is not rare for investment objects. The investor said, “From a historical perspective, there are a lot of things that don’t have intrinsic value, but have perceived value. And then the heat went in and then cooled off again. It could come one way or the other.” You just have to know what bitcoin is — and that “it could be Holland’s tulips,” Dalio told CNBC, referring to the tulip mania of the 17th century.
For him, Bitcoin is a “viable investment solution” as long as it is accepted as a method of payment, according to the founder of Bridgewater Associates. “I think it is worth looking at all the alternatives to cash and all the alternatives to other financial assets. Bitcoin is a possibility,” Dalio said in an interview with CNBC. Therefore, he also invested a certain amount of money in Bitcoin himself. However, the stake is small compared to the share of gold in its portfolio – which in turn is very small compared to other asset classes. Dalio said there is something to this about though, and he also advised other investors to diversify their holdings and include bitcoin in the process.
Finanzen.net Editorial Team
Image sources: CNBC/Getty Images, Lightboxx/Shutterstock.com
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