As Bitcoin prices soared above $18,000, Bridgewater Associates founder Ray Dalio stepped back into the fray, saying in a Twitter thread that “I might be missing something about Bitcoin so I’d love to be corrected.”
Dalio added : “My problems with Bitcoin being an effective currency are simple. They are that:
1) Bitcoin is not very good as a medium of exchange because you cant buy much with it (I presume that’s because it’s too volatile for most merchants to use, but correct me if I’m wrong)
2) it’s not very good as a store-hold of wealth because it’s volatility is great and has little correlation with the prices of what I need to buy so owning it doesn’t protect my buying power, and…
3) if it becomes successful enough to compete and be threatening enough to currencies that governments control, the governments will outlaw it and make it too dangerous to use.
Also, unlike gold which is the third highest reserve assets that central banks own, I can’t imagine central banks, big Institutional investors, businesses or multinational companies using it. If I’m wrong about these things I would love to be corrected. Thank you.
This comes after Dalio’s comments last week that “I don’t think digital currencies will succeed in the way people hope they would,” citing those three main problems with bitcoin and other cryptocurrencies that will limit their future.