- Ray Dalio, formerly a Bitcoin skeptic, has now admitted to holding some of the cryptocurrency
- Dalio previously said that Bitcoin was not an effective medium of exchange or store of value
- Dalio also warned that Bitcoin could be heavily regulated if big banks swap bonds for Bitcoin
Ray Dalio is officially a bitcoin owner. The man who in 2017 called the cryptocurrency market “speculative people thinking ‘can I sell it at a higher price’” has done just that and bought into Bitcoin at a higher price than he would have done when he made the comments in September 2017. Dalio said he owned “some” bitcoin during a virtual appearance at Consensus yesterday, although he added that Bitcoin could face harsh regulatory curbs if its success begins to affect the bond market.
Dalio Backs Up Reversal With Purchase
Speaking at consensus, Dalio admitted that he now owns an unspecified amount of bitcoin, a position that marks a change in his attitude from 2017 when he called it a poor store of value and an ineffective medium of exchange. In truth he signaled his shift in viewpoint last year when he said in December that Bitcoin had established itself as a “gold-like asset alternative.”
Dalio’s change in stance on Bitcoin is significant given that he founded and runs $140 billion hedge fund Bridgewater Associates, and his views could well represent the broader opinion of Wall Street.
Regulations Could Hit Bitcoin Hard
Dalio’s appearance wasn’t all good for Bitcoin however as he reiterated his warning from December that “Bitcoin’s biggest risk is its success”, saying that as it becomes a “bigger deal” in the financial world its runs a risk of being more heavily regulated:
Let’s say people want to sell their bonds and they want to buy bitcoin. They (the government) lose control over that, and that’s an existential risk. The more that happens…it goes into Bitcoin and it doesn’t go into credit and they lose control of it…that’s a risk.
This prophecy seems some way distant, given that there is no sign yet that banks are swapping government bonds for Bitcoin, although with yields turning negative in some cases and Bitcoin continuing to rise on a macro level, such a scenario could play out. Dalio seemed to bear this out, adding saying that he personally “would rather have Bitcoin than a bond”, an attitude that may well begin to filter through to the deep pockets of Wall Street.
