Bitcoin is enjoying its moment in the sun now, but the world’s No. 1 digital asset could face major resistance by government’s looking to rein in the decentralized crypto, according to Bridgewater Associates Ray Dalio.
“Every country treasures its monopoly on controlling the supply and demand. They don’t want other moneys to be operating or competing, because things can get out of control. So I think that it would be very likely that you will have it under a certain set of circumstances outlawed the way gold was outlawed,” Dalio told Yahoo Finance during an interview that aired Wednesday.
Dalio enumerated a list of positive attributes of bitcoin, including its growing following, its security, and the asset’s ability to serve as an alternative asset and potentially a store of value. “Bitcoin has proven itself over the last 10 years…it’s by and large worked on an operational basis…those are the pluses,” he explained. However, he characterized bitcoin as a potential threat to a government’s control of its banking and money supply systems—“cause things can get out of control.” Dalio’s comments come amid reports that India is considering a ban on cryptoassets, which could possibly criminalize the possession, mining, trading or transferring of crypto. The Bridgewater founder also referenced a 1934 act, signed by President Franklin D. Roosevelt, who controversially ended all private holding and use of gold as money. The act also established the exchange stabilization fun as a reserve to stabilize the U.S. dollar after the government abandoned the gold standard. Dalio’s Bridgewater is the largest hedge fund in the world, managing some $140 billion and his own net worth is $20.3 billion, according to Forbes. At last check, bitcoin prices were changing hands at $55,969, up 2.6%, and has climbed 93% so far in 2021. By comparison, gold prices are down 8.4% so far this year, while the Dow Jones Industrial Average DJIA, 0.24% is up 7% in the year to date, the S&P 500 index SPX, 0.25% is up 4.7%, while the Nasdaq Composite Index COMP, -0.73% was up 2.2% on the year.
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