Ray Dalio, founder of Bridgewater Associates, said that Bitcoin (BTC) is not behaving as a “safe haven” asset as many investors expect.
Dalio stated that Bitcoin’s lack of privacy, the fact that transactions are traceable and potentially controllable, and its high correlation with technology stocks are among the main reasons for this situation.
According to Dalio, when stress increases in the markets, investors turn to selling Bitcoin to create liquidity. The renowned investor also argues that the Bitcoin market is relatively small and therefore more easily influenced, while gold maintains its central role due to its wider reach and established position in the global financial system.
Ray Dalio stated, “Bitcoin is attracting a lot of attention, but it hasn’t lived up to the safe-haven role many expected. There are several reasons for this. First, Bitcoin lacks privacy. Transactions are traceable and potentially controllable, which is why central banks aren’t considering holding it as a reserve. Also, it has a high correlation with technology stocks. Investors sell their Bitcoins when they come under pressure in other parts of their portfolios.”
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Dalio also stated, “Bitcoin is a relatively small and controllable market. In contrast, gold occupies a unique position. There is only one gold. Gold is more widely held, has a long history, and maintains its central role in the global system.”
On the other hand, Michael Saylor responded to Dalio’s assessments, defining gold as “analog capital” and Bitcoin as “digital capital.” Saylor argued that Bitcoin’s transparent nature is not a weakness, but a strength that allows it to be used as collateral on a global scale.
Saylor also argued that BTC has performed much more strongly than gold since Strategy adopted the Bitcoin standard in August 2020.
*This is not investment advice.
Continue Reading: Ray Dalio, Who Manages $150 Billion, Says “Gold Is Better Than Bitcoin”; Michael Saylor Responds Immediately