Veteran hedge fund manager and former crypto skeptic Ray Dalio says he’s in Bitcoin and the top smart contract platform invested Ethereum (ETH)because the inflation the cash is further devalued.
In a new interview with Yahoo Finance, the billionaire investor says he owns BTC and ETH as alternatives to cash at a time when money is rapidly depreciating.
When asked about his cryptocurrency portfolio, Dalio says:
“Well, I’m not going to give the exact amount of Bitcoin – but I own some” Ethereum as well. But the answer to your question is that I don’t own a lot of it. I see it as alternative money in an environment where the real value of cash is falling.
And I find it very impressive for that [the] For the past 10, 11 years the programming has still held up, it hasn’t been hacked, etc., and it has an adoption rate. “
Dalio says that while many investors believe cash makes sense as part of a portfolio, inflation can hurt the fiat currency more than most expect.
“I would like to say that cash – I was quoted as saying [saying] “Cash is trash” – what most investors consider to be the safest investment is, in my opinion, the worst investment. And that is important because it is losing purchasing power.
The only thing I would say to investors is that you don’t judge your returns or your net worth by how many dollars you have. Think of it in terms of dollars, adjusted for inflation.
And how much money will you lose 4% or 5% this year to inflation. OK, pay attention [that]because I think that’s the worst investment. “
Dalio then says that cryptos play a role in diversifying investor portfolios that could serve as a hedge against inflation.
“It is important that Portfolio diversify well. Because we know about the surprises on the balance sheet – we also know that these asset classes perform significantly better on average and will significantly outperform cash.
And that they move with one another in ways that have to do with correlations, because if things go down, if the economy slows down, then bonds will outperform stocks and so on and so on. So diversification of assets – I see crypto as a small part of it. “
ETH is swapping hands at $ 3,851 at the time of writing, down 5.7% from its seven-day high of $ 4,084.
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Source: Crypto News Deutsch