Ray Dalio Advocates 15% Allocation to Bitcoin and Gold Amid U.S. Debt Concerns.

Ray Dalio, founder of Bridgewater Associates, recommends a 15% allocation to Bitcoin and gold in portfolios due to growing concerns over U.S. debt risks. This shift reflects a significant increase from his previous guidance of 1-2% in Bitcoin. Dalio views Bitcoin as a credible macro hedge and believes it can provide a reduced volatility as global wallets expand.

Hedge fund manager Ray Dalio, founder of Bridgewater Associates, has recommended a significant increase in the allocation of Bitcoin and gold in investment portfolios. Dalio suggests that investors allocate approximately 15% of their portfolios to these store-of-value assets to hedge against growing U.S. debt risks and currency devaluation [1][2][3].

This recommendation marks a substantial shift from Dalio's earlier guidance of 1-2% Bitcoin allocation in January 2022. The change reflects his growing concerns over the U.S. national debt, which has ballooned to $36.7 trillion, and the potential for currency devaluation [1][2][3]. Dalio believes that both Bitcoin and gold can serve as effective diversifiers against weakening fiat currencies and systemic risks.

Dalio's comments were made in the context of the U.S. government's increasing reliance on debt to finance budget deficits. The latest US Treasury report projects an additional $1 trillion in borrowing during the third quarter, exceeding previous estimates by $453 billion. This underscores the government's growing fiscal challenges and the need for investors to diversify their portfolios [1][2][3].

Despite his advocacy for Bitcoin as a macro hedge, Dalio remains cautious about its potential to serve as a reserve currency. He highlighted concerns over Bitcoin's transparency, noting that governments can track transactions, which may limit its adoption by central banks. Dalio also mentioned potential vulnerabilities in Bitcoin's code that could undermine its effectiveness as an alternative form of money [1][2][3].

Bitcoin and gold have performed strongly in the current economic climate. Bitcoin is currently trading near $118,100, just 4% below its all-time high of $123,230 recorded on July 14. Gold has also surged, reaching multiple new highs over the past few months [1][2][3].

In conclusion, Ray Dalio's recommendation to allocate 15% of investment portfolios to Bitcoin and gold underscores the growing importance of store-of-value assets amid the escalating U.S. debt crisis. While Dalio favors gold for its stability, Bitcoin remains a valuable diversifier despite concerns about its potential as a reserve currency. Investors should consider these insights to safeguard their portfolios against currency devaluation and fiscal uncertainty.

References:
[1] https://cointelegraph.com/news/ray-dalio-suggests-15-percent-bitcoin-allocation
[2] https://en.coinotag.com/ray-dalio-suggests-considering-15-bitcoin-allocation-amid-us-debt-concerns-and-currency-risks/
[3] https://www.ainvest.com/news/bitcoin-news-today-ray-dalio-advises-15-gold-bitcoin-macro-risk-hedge-2507/