Renowned investor Ray Dalio does not consider cryptocurrencies reliable investments. The founder of Bridgewater Associates prefers to invest in gold, though his own portfolio includes a few Bitcoins.
Ray Dalio is certain that BTC is overvalued, so its fair value should be lower than stocks of large companies, such as Microsoft. Interestingly, Bitcoin’s market capitalization amounts to $574 billion whereas Microsoft’s correspondent value equals $2.27 trillion.
The well-known hedge fund manager "doesn't understand why people are more inclined to go to bitcoin than gold." "Gold is a well-established, blue-chip alternative to fiat money," he defines the merit of the precious metal. The American billionaire believes that gold is the third most important reserve asset for central banks. The priority is certainly given to the US dollar, the euro is ranked second, while gold and the yen follow in the descending order. Notably, central banks buy gold, not government bonds, Ray Dalio underscores.
The entrepreneur is not a fan of Bitcoin, albeit he acknowledges its significance. He confessed that he holds a "little bit" of Bitcoin. He warns that crypto investors should beware of extreme volatility in the crypto market and be braced for heavy losses. Ray Dalio cautions that the flagship crypto could slump by 80%, thus smashing the savings of market participants.
At present, Bitcoin’s price is way below the historic peak of $67,000 recorded in November 2021. Since the beginning of 2023, the token has appreciated by 80% and approached the landmark level of $30,000.
The rally of the number one crypto has been unfolding amid market expectations for a pause in the Federal Reserve’s cycle of rate hikes. Besides, Bitcoin benefits from the bank turmoil triggered by the crash of two US banks in March 2023.
