Ray Dalio cautions on Bitcoin, says ‘there is only one gold’

Billionaire investor Ray Dalio has warned against Bitcoin as a long-term store of value and safe-haven asset, arguing that it has little central bank support and has lingering concerns over its privacy limitations and quantum resistance.

Dalio dismissed the idea that Bitcoin (BTC) can function as a digital gold, telling the All-In Podcast on Tuesday that “there is only one gold.”

"Gold is not a precious metal that's speculated on,” Dalio said, adding it is the “most established money” that is the second-largest reserve currency held by central banks.

Dalio added he doesn’t see why central banks would want to buy Bitcoin and hold it over the long term.

Dalio speaking on the All-In Podcast on Tuesday. Source: All-In Podcast

Dalio has previously said that Bitcoin has hard money characteristics and noted that it continues to “have a pretty high correlation with tech stocks.”

“So, from an ownership perspective, supply and demand can be affected if somebody gets squeezed in one area and has to sell something else they hold."

Dalio also raised concerns about Bitcoin’s lack of privacy, stating “any transaction can be monitored,” and warned that quantum computing could threaten the network.

In July, Dalio recommended a 15% portfolio allocation into Bitcoin or gold to optimize for the “best return-to-risk ratio” in light of America’s crippling debt problem and continued currency debasement.

Related: Bitcoin dives 3% on global asset rout as $5K gold 'smashed' on oil fears

Between July and early October, Bitcoin and gold were both on the rise until a broader crypto market crash wiped out nearly $20 billion in leveraged positions.

The pair then decoupled in early October, with Bitcoin falling over 45% since its October peak to $68,420, while gold has continued to rally, climbing over 30% to $5,120 in that timeframe.

Dalio says the world as we know it has changed

Dalio sent a message to investors last month, warning that the “World Order,” one led by the US for the best part of a century, had “broken down,” and that investors must rethink how they protect their wealth amid rising geopolitical conflict and economic disorder.

Dalio reinforced his long-held position that stores of value, particularly gold, are the best option to preserve wealth when currencies falter and credit systems break down, while debt assets become vulnerable as uncertainty rises.

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