Ray Dalio advises holding small amount of Bitcoin

Ray Dalio, the founder of Bridgewater Associates, has updated his stance on Bitcoin, suggesting that investors hold ‘a bit of Bitcoin’ to navigate risks associated with global debt and deficit problems. While Dalio previously labeled the cryptocurrency a bubble in 2017, he now views non-government-produced money as a potential way to manage economic instability. He has suggested that an allocation of up to 2% of a portfolio to Bitcoin may be reasonable.

However, critics argue that Bitcoin may not serve as an effective tool for risk mitigation. Data indicates that Bitcoin often moves in tandem with the S&P 500; between 2016 and 2025, the two moved in the same direction in eight out of ten years. This correlation suggests that in the event of a major debt crisis or stock market downturn, Bitcoin could experience significant losses similar to or greater than equities, unlike gold, which Dalio suggests for a larger 10%-15% allocation due to its tendency to move inversely to stocks.