Bitcoin News Today: Dalio Sounds Debt Alarm: 15% to Gold and Bitcoin as Dollar Loses Luster

Bridgewater Associates founder Ray Dalio has expressed concerns over the U.S. debt burden and its potential implications for the dollar’s status as a reserve currency, signaling a growing appeal for gold and cryptocurrencies as alternative stores of wealth. Dalio emphasized that excessive fiscal spending and increasing debt levels in reserve-currency-issuing nations are eroding confidence in fiat currencies, with both Bitcoin and gold witnessing rising demand as a result. He noted that the U.S. government currently spends $7 trillion annually while generating only $5 trillion in revenue, leading to a $2 trillion annual deficit and a looming $12 trillion debt issuance requirement for the coming year. These figures, he argued, underscore a dangerous trajectory toward a “debt-induced heart attack” within the next three years [1].

The billionaire investor has recommended allocating up to 15% of a risk-adjusted portfolio to gold and Bitcoin, positioning them as hedges against monetary depreciation. Dalio cited Bitcoin’s capped supply of 21 million coins as a key characteristic that differentiates it from fiat currencies, which he believes are at risk of losing value due to expanding money supplies and political pressures on the Federal Reserve. He warned that a politically weakened Fed could lead to inflationary pressures, causing bonds and the dollar to decline in value and further damaging their effectiveness as wealth stores [2].

Gold, meanwhile, has seen a notable surge in 2025, reaching an all-time high above $3,500 per ounce, according to London bullion market auctions. This trend has been attributed to rising inflation concerns and the weakening appeal of U.S. bonds, with Dalio describing gold as the world’s second-largest reserve asset and a reliable hedge against stock market volatility. In contrast, Bitcoin has shown resilience during periods of bond market stress, offering a different kind of diversification. André Dragosch of Bitwise Asset Management noted that while gold traditionally protects against equity downturns, Bitcoin has performed better during Treasury sell-offs, suggesting that both assets serve distinct roles in a diversified portfolio [3].

Dalio also addressed the role of stablecoins, arguing that well-regulated stablecoins backed by U.S. Treasuries do not pose significant systemic risks. However, he highlighted the broader concern that the declining purchasing power of Treasuries could undermine their value and, by extension, stablecoins tethered to them. The recent passage of the GENIUS Act, which mandates stablecoins to be fully backed by liquid assets and requires annual audits for large issuers, was cited as a step toward ensuring market stability [4].

Looking ahead, Dalio compared the current economic landscape to late-stage debt cycles in the 1930s and 1970s, emphasizing that the convergence of debt, politics, climate, and technological advancements—particularly in AI—will drive unprecedented changes over the next five years. He warned that investors must prepare for a world where traditional monetary systems may no longer function as they once did, and where hard currencies like gold and Bitcoin could play an increasingly important role in preserving wealth [5].

Source: [1] Ray Dalio says soaring US debt threatens dollar, fueling ... (https://www.theblock.co/post/369266/ray-dalio-crypto) [2] Hedge Fund Billionaire Ray Dalio Breaks Down What Could ... (https://finance.yahoo.com/news/hedge-fund-billionaire-ray-dalio-055025623.html) [3] Bitcoin or Gold: Which Is the Better Hedging Asset in 2025? (https://www.coindesk.com/markets/2025/08/31/given-trump-s-pro-crypto-stance-is-it-time-to-fully-ditch-gold-in-favor-of-bitcoin) [4] Gold Tops $3500 Record Price (https://www.bullionvault.com/gold-news/gold-price-news/gold-record-3500-debt-trump-silver-090220251) [5] Billionaire Ray Dalio Links Bitcoin's Rise to 'Debt-Fueled ... (https://decrypt.co/337925/billionaire-ray-dalio-bitcoins-rise-debt-attack-u-s)