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Ray Dalio mentioned regulators will shut down bitcoin if the cryptocurrency becomes too successful and dismissed predictions by Ark Invest’s Cathie Wood that its worth would enhance tenfold inside 5 years.
Speaking on the Salt Conference on Wednesday, the founding father of Bridgewater Associates, mentioned bitcoin could be a viable funding different so long as it was accepted for funds, however added: “I think at the end of the day if it’s really successful . . . [regulators] will try to kill it.”
He additionally took concern with Wood, who instructed the Salt convention — an annual gathering of hedge fund managers in New York City — on Monday, that she anticipated bitcoin to be value $500,000 in 5 years, a forecast that Dalio mentioned “doesn’t make sense”.
Wood’s funding agency has unveiled plans for a bitcoin alternate traded fund, though it is but to obtain regulatory approval.
Dalio’s feedback come after Gary Gensler, chair of the US Securities and Exchange Commission, referred to as on Congress for extra regulatory powers to cope with the “Wild West” of cryptocurrencies.
The SEC final week warned Coinbase, the primary main US cryptocurrency alternate to listing publicly, that it would sue the corporate if it launched a brand new digital asset lending product referred to as Lend.
The information sparked a debate on whether or not such merchandise, which permit customers to earn curiosity on sure digital belongings, must be thought of securities and subsequently fall beneath the regulator’s jurisdiction.
Dalio mentioned he has himself bought cryptocurrencies however his holdings are nonetheless small relative to his investments in gold. He added that “governments don’t want alternative currencies” however that traders ought to diversify their holdings.
The worth of bitcoin has jumped virtually 50 per cent this 12 months with high-profile traders equivalent to Paul Tudor Jones and Stanley Druckenmiller throwing their weight behind the cryptocurrency.
Dalio, who’s co-chief funding officer and co-chairman of the world’s largest hedge fund, with greater than $100bn in belongings, additionally indicated that he’s making ready to go away the business. “I’m done in a year or two,” he mentioned.
The investor predicted that markets would look completely different within the subsequent few years as the consequences of fiscal and financial stimulus wore off. “You’ve had a good stimulant and everyone is high and it’s great. But when that wears off, it’s going to be somewhat of a different picture,” he mentioned.