Ray Dalio Calls Bitcoin a Hedge Against U.S. Debt

The Bridgewater founder puts Bitcoin alongside gold in a defensive portfolio as rising U.S. debt and higher rates put pressure on the dollar and Treasuries.

Key Takeaways

• Ray Dalio says investors should hold a little Bitcoin now that the U.S. government is sinking deeper into debt trouble.
• Dalio still sees gold as the bigger hedge, but he also names Bitcoin as part of a defensive portfolio.
• He links the recent bond and dollar moves to rising U.S. debt and expects similar pressure in other major economies.

Ray Dalio says investors should hold “a little Bitcoin” now that the U.S. government is getting deeper into a debt problem. According to the Bridgewater founder, that could weaken the dollar over time and make government bonds less attractive. Dalio still sees gold as the bigger hedge, but he explicitly names Bitcoin as part of a defensive portfolio.

Debt and Bonds

Dalio said Friday that several recent moves in the bond market fit the pattern he described earlier in his book How Countries Go Broke. He pointed, among other things, to Japan selling U.S. Treasuries, rising yields on long-dated U.S. government bonds, and a weaker dollar. He also said Treasury Secretary Scott Bessent's decision to ramp up buybacks of government bonds fits that picture.

Crypto investors linked last week's rally to that adjustment in the buybacks. Bitcoin Nears $75,000 After Wave of Short Liquidations rose from about $63,500 (€54,300) on Wednesday to above $78,000 (€66,700) on Saturday, while about $4 billion (€3.4 billion) in bearish positions were closed along the way. Dalio says governments buy back their own debt when demand falls, but that Bessent can only keep doing that to a limited extent.

The U.S. government expects to bring in about $5.5 trillion (€4.7 trillion) in revenue this year and spend around $7.5 trillion (€6.4 trillion). That leaves a deficit of about $2 trillion (€1.7 trillion). Federal debt excluding money the government owes itself stands at around $32 trillion (€27.4 trillion), while interest costs alone are expected to reach about $1 trillion (€0.9 trillion).

Why Bitcoin Belongs There

Dalio expects similar pressure in the U.K., the European Union, China, and Japan as well. That is why he sees assets not issued by governments, such as gold and Bitcoin, as relatively strong in a scenario where currencies are devalued. In doing so, he repeats a view he has been sharing for years, even though he admits earlier warnings sometimes seemed too early.

That broader view fits Dalio's long-running focus on diversification and risk balance. He has long framed gold as protection against currency weakness and geopolitical stress, with earlier recommendations to keep 5% to 15% of a portfolio in gold. In 2022, he stepped back from day-to-day leadership at Bridgewater Associates, which gave him more room to focus on macro analysis like this.

What Investors Can Take From This

For European crypto readers, the main takeaway is that a well-known traditional investor no longer sees Bitcoin only as speculative, but also as a possible hedge alongside gold. That does not mean a price move is guaranteed, but it does show Bitcoin is being discussed more often in broader conversations about debt, inflation, and currency risk. Especially now that central banks and government bond markets are also under pressure, that framing could remain important for institutional investors.