Billionaire Ray Dalio Doubles Down on Dollar Decline Warnings—Pitches Bitcoin as Ultimate Hedge

Ray Dalio sounds the alarm—again. The billionaire investor’s latest warning hits hard: the U.S. dollar’s dominance is slipping, and fast.

Why It Matters

When the founder of Bridgewater speaks, markets listen. Dalio’s not just talking theory; he’s pointing to real momentum shifts in global reserve trends. And his solution? Look beyond traditional safe havens.

Enter Bitcoin

Dalio positions Bitcoin as a viable hedge—a digital alternative to gold when currencies wobble. No central bank control, no inflationary printing—just decentralized scarcity. He’s not saying go all-in; he’s saying don’t ignore it.

The Big Picture

It’s another nod to crypto’s rising credibility among finance elites—even if some still see it as a hedge against… well, sanity. But love it or hate it, Bitcoin’s staying power is getting harder to dismiss. Maybe it’s time to ask: what’s riskier—volatility, or ignoring the shift altogether?

Fiat currencies destined to fall

Dalio argued that the U.S. government’s soaring debt service costs, now about $1 trillion annually, combined with fresh borrowing needs, are eroding confidence in Treasuries and the dollar.

He added that this dynamic makes alternative assets more appealing.

According to Dalio:

“Crypto is now an alternative currency that has its supply limited, so, all things being equal, if the supply of dollar money rises and/or the demand for it falls, that would likely make crypto an attractive alternative currency.”

He also shared his belief that all fiat currencies are destined to fall in value against “hard currencies” like Bitcoin.

Dalio said:

“This is what happened in the 1930 to 1940 period and the 1970 to 1980 period.”

He made the statement in response to a question about whether crypto could viably replace the dollar. He also responded to questions regarding stablecoins and their exposure to treasuries.

The FT questioned whether the dynamic could pose a systematic threat to stability. Dalio responded, “I don’t think so.” He added that declining treasury buying power is a bigger systemic threat in his view.

Dalio has previously suggested that investors allocate up to 15% of their portfolios to alternatives like gold and Bitcoin to protect against monetary debasement.

Reserve status in jeopardy

Dalio said the Federal Reserve faces a dilemma between letting interest rates rise, risking default and market turmoil, or printing money to cover obligations, which WOULD weaken the dollar’s value.

He warned that foreign holders have already begun reducing their exposure to U.S. bonds and turning to gold, a classic sign of late-cycle stress.

Political threats to Fed independence, he added, could accelerate the erosion of confidence and further push investors toward scarce, decentralized assets.

Dalio placed these pressures in the context of what he calls the “big cycle,” a recurring set of forces including debt, political strife, geopolitical conflict, climate risks and technological disruption.

He said their convergence could produce “huge and unimaginable changes over the next five years.”

By publishing the Q&A, Dalio said he sought to provide a clear, non-partisan analysis of how U.S. policy decisions are reshaping global finance. For Bitcoin, his warnings suggest its role as a hedge may strengthen as trust in the dollar erodes.