Billionaire investor Ray Dalio thinks an increased dollar supply could raise the attractiveness of crypto assets.
Dalio, who founded the asset management firm Bridgewater Associates, posted a written interview he completed for the Financial Times after claiming the media outlet “published mischaracterizations” of what he said.
In the interview, the famous investor says that big governments’ bad debt situations are threatening the appeal of their currencies as reserve currencies.
Dalio says those debt situations are also contributing to the rise in gold and cryptocurrency prices.
“Crypto is now an alternative currency that has its supply limited, so, all things being equal, if the supply of dollar money rises and/or the demand for it falls, that would likely make crypto an attractive alternative currency. I think that most fiat currencies, especially those with large debts, will have problems being effective storehouses of wealth and will go down in value relative to hard currencies. This is what happened in the 193s to 1940 period and the 1970 to 1980 period.”
Dalio also notes that he doesn’t view stablecoins’ exposure to Treasuries as a potential systemic risk.
“However, I see a fall in the real purchasing power of Treasuries as being a real risk. That shouldn’t produce any systemic risk in stablecoins if they are well-regulated.”
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