Billionaire investor Ray Dalio has significantly raised his recommended exposure to Bitcoin and gold, warning that America’s ballooning debt could trigger a financial spiral and undermine the U.S. dollar.
Bridgewater Associates founder Ray Dalio has sounded a fresh alarm on the U.S. economy. He suggests investors increase their holdings in Bitcoin or gold to as much as 15% of their portfolios, a sharp rise from his previous guidance of 1–2% in 2022.
In a recent interview on the Master Investor podcast, Dalio expressed growing concern over the U.S. government’s fiscal trajectory. He cited a projected $12 trillion in new Treasury issuance over the next 12 months.
The funding is aimed at managing the ballooning $36.7 trillion national debt, a scenario Dalio believes could spiral into what he calls a “debt doom loop.”
Treasury Borrowing Soars Above Forecasts
Adding weight to Dalio’s warning, a new U.S. Treasury report released Monday revealed an increased borrowing forecast, signaling deeper financial concerns. The government now expects to borrow $1 trillion in the third quarter, $453 billion more than previously projected. It also plans to add another $590 billion in the fourth quarter.
Dalio interprets these rising figures as signs of underlying structural problems. He believes these issues could, over time, erode global confidence in the U.S. dollar.
Gold and Bitcoin as Safe Havens
While Dalio has historically preferred gold, he now regards both gold and Bitcoin as strategic hedges against currency depreciation. He describes both assets as “effective diversifiers” and emphasizes their value in an environment where traditional fiat money may lose purchasing power.
However, he stopped short of endorsing Bitcoin as a future reserve currency, raising concerns about surveillance issues and the potential for code-level flaws that could compromise the network. Specifically, Dalio noted that Bitcoin transactions are public, and governments globally want privacy.
Flexible Allocation
Despite these caveats, Dalio acknowledged that he holds a small amount of Bitcoin. His 15% allocation suggestion is not fixed but meant to be a flexible guideline.
He said investors should decide for themselves how to distribute that allocation between gold and Bitcoin. The decision should depend on their individual preferences and risk tolerance.
Dalio’s shift in perspective comes amid the growing mainstream acceptance of digital assets. Public and private firms now hold over 1.4 million BTC tokens. As of press time, Bitcoin is trading at $118,891, down 0.05% in the past 24 hours.
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