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Bridgewater Associates founder Ray Dalio said, “I don’t think bitcoin is the case” when it comes to efficient money.
The famed investor instead offered an inflation-linked coin that would keep buying without the wild volatility typical of the leading cryptocurrency.
Dalio is not pro-Bitcoin
Speaking to CNBC, Dalio said what Bitcoin “has accomplished” in its relatively short history is “pretty amazing,” adding that in his view it doesn’t correlate with other assets.
“I think it’s pretty amazing that for 12 years what he’s achieved, but I think it has nothing to do with anything.”
He also said, “it’s a small thing that attracts disproportionate attention”, supporting this point, he mentioned that its market capitalization is one-third that of Microsoft. On top of that, many industries, including biotech, are much more attractive to him from an investment perspective.
Dalio has further shattered the idea that he is pro-Bitcoin by questioning its effectiveness as a currency, store of value and medium of exchange. However, he acknowledged that the monetary system is broken.
“It will not be effective money; it will not be an effective store of wealth, it is not an effective medium of exchange. But we are in a world where money as we know it is in danger. We print too much.
Alluding to a currency crash, which he called “things opening up in an evolutionary way,” Dalio predicts people will be rushing to some kind of safety.
Fix the monetary system
When asked if that “security” was bitcoin, Dalio was adamant that neither bitcoin nor fiat-backed stablecoins would do.
“I think if you want a digital currency you have to do something different. I don’t think stablecoins are good because then you get fiat currency again.
Instead, an inflation-linked coin would be a feasible alternative. Through an inflation-linked coin, people can secure their purchasing power. While Bitcoin savings are subject to large swings in volatility, Dalio said.
“If you create a coin that says, okay, this is buying power that I know I can save and invest my money in over a period of time, and I can transact anywhere, I think it would be a good play.”
The Frax Price Index (FPI) is an example of an existing coin that derives its price by pegging to real-world consumer prices.
Posted in: Bitcoin, People
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