“I don’t think it’s Bitcoin,” says Ray Dalio, founder of Bridgewater Associates, when it comes to money in action.
A high-profile investor instead proposed an inflation-linked coin that would sustain purchases without the intense volatility typical of major cryptocurrencies.
Dario is not a bitcoin supporter
In an interview with CNBC, Dalio said it was “extremely amazing” what Bitcoin has “done” in its relatively short history, adding that in his view Bitcoin is correlated with other assets. He added that he did not.
“I think it’s quite amazing what it has achieved in 12 years, but I don’t think it has anything to do with it.”
He also said, “It’s a small thing that gets disproportionate attention,” backing up this point by saying its market capitalization is a third of Microsoft’s. In addition to this, many industries, including biotechnology, are much more attractive to him from an investment perspective.
Dalio further shattered the notion that he was a bitcoin advocate by questioning the validity of bitcoin as a medium of money, store of value and exchange. But he admitted that the money system is broken.
“It will not be effective money. It will not be an effective store of wealth. It will not be an effective medium of exchange. We live in a world that is exposed to too much printing.”
Alluding to a currency collapse, which he described as “things evolutionarily open up,” Dalio foresees people rushing to some kind of safety.
fix the money system
When asked whether that “safety” was Bitcoin, Dalio asserted that neither Bitcoin nor fiat-backed stablecoins fit the bill.
“If you want a digital currency, I think you have to do something different. I don’t think stablecoins are good.
Instead, inflation-linked coins would be a viable alternative. Through inflation-linked coins, people can secure their purchasing power. Dalio said that bitcoin savings are subject to wild swings in volatility.
“Okay, this is purchasing power, and if we create a coin that shows that you can save over a period of time and put money in it and you can trade anywhere, I think it will be a good coin.”
Frax Price Index (FPI) is an example of an existing coin that derives its price by pegging it to a real-world consumer price.
