Billionaire investor Ray Dalio has acknowledged Bitcoin as a form of money, citing its fixed supply and rising acceptance as a store of value. However,
he remains unconvinced that the world’s largest cryptocurrency can replace gold as a dependable long-term store of wealth. Speaking on a recent podcast with Zerodha founder Nithin Kamath, the Bridgewater Associates founder said Bitcoin meets some basic criteria of money but falls short on key structural and risk-related factors. Bitcoin Has Scarcity, But Not Complete Safety Dalio described Bitcoin as a limited-supply asset whose perception as money has strengthened over time. “Bitcoin is limited in supply and its perception of money,” he said, adding that it does qualify as a form of money. That said, Dalio argued that scarcity alone is not enough. In his view, gold remains superior because it has survived multiple monetary regimes without being undermined by technological or regulatory risks. Transparency Raises Regulatory Risks One of Dalio’s primary concerns is Bitcoin’s transparency. Because blockchain transactions are publicly recorded, governments can monitor activity and potentially intervene. “Gold is the only asset authorities can’t mess with and control,” Dalio said, contrasting it with Bitcoin’s traceable nature. He warned that this visibility could expose Bitcoin holders to future regulation, restrictions, or confiscation risks. Technology Could Be A Weak Link Dalio also flagged technological vulnerability as a long-term risk. He suggested that Bitcoin could theoretically be compromised, controlled, or replaced, comparing it to synthetic diamonds or engineered alternatives to gold. While he did not predict such an outcome, he stressed that technological assets carry risks that physical commodities like gold do not. Bitcoin Is A Hedge, Not A Core Holding Despite his reservations, Dalio confirmed that he does hold a small amount of Bitcoin. However, he views it strictly as a hedge rather than a central portfolio asset. Earlier this year, Dalio disclosed that roughly 1% of his portfolio is allocated to Bitcoin. Portfolio construction, he said, depends on how each asset functions within the broader mix rather than on conviction alone. Gold Remains Dalio’s Preferred Store Of Value Dalio reiterated that gold continues to be the foundation of wealth preservation outside traditional financial systems. He generally recommends allocating 5% to 15% of a portfolio to gold. By comparison, he said stablecoins serve more as transactional tools than stores of value, as they are tied to fiat currencies and lack intrinsic yield.
