Hedge fund legend Ray Dalio, who participated in William Green’s “We Study Billionaires” podcast, expressed his thoughts on cryptocurrencies, especially Bitcoin. The successful investor stated that he believes there is a difference between blockchain technology and digital currencies. According to the billionaire, while the former is an excellent technology, the latter is not a good option for investors. Dalio stated that digital currencies do not represent anything, making them an ineffective store of wealth.
Dalio believes that over time, better digital currencies will emerge that will provide the equivalent of inflation and purchasing power. Dalio noted that most currencies are debt instruments with low returns compared to inflation, but a good digital currency has yet to be created.
While the legendary investor appreciates the technology behind cryptocurrencies, he believes the hype surrounding them is disproportionate to their true value. As an experienced investor, he emphasizes the importance of seeking effective wealth storage and being cautious when investing in digital currencies.
Dalio stated that people will need to look for alternative means of storing wealth, and he believes that understanding the five fundamental forces of the economy, including money and credit, can help investors overcome difficult situations.