Hedge fund veteran Ray Dalio says he would rather own Bitcoin (BTC) than bonds – but he believes the top cryptocurrency may have some big roadblocks ahead.
The founder of Bridgewater Associates says in a new Bloomberg interview that problems may arise if and when people start to prefer the flagship cryptocurrency over traditional assets.
“I think Bitcoin’s greatest risk is its success… As it becomes a bigger deal and more of a threat, let’s say people want to sell their bonds and they want to buy Bitcoin, and they want to do that in a bigger way like buying gold or something, in a bigger way, and then there’s more transactions. They lose control over that, and that’s an existential risk.”
He says that the government may see it as a threat when people consider Bitcoin a better store of wealth.
“The more we create savings in it, the more you might say, ‘I’d rather have Bitcoin than the bond.’ Personally, I’d rather have Bitcoin than a bond. The more that happens, then it goes into Bitcoin, and it doesn’t go into credit, then they lose control of that, and you know that’s a risk.”
The billionaire has previously warned that the US may ban Bitcoin as people look for an alternative to bonds and currencies during the global financial crisis.
He’s also highlighted the Gold Reserve Act, which took effect in the 1930s to prevent the yellow metal from competing with the US dollar.
In March, Dalio also said the US government may impose higher taxes on Bitcoin and gold to prevent investors from moving their capital from debt assets.
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