Cryptocurrencies are getting more and more recognition in the traditional financial industry. The veteran Bridgewater Associates is now also looking to make its first investments in the crypto industry. According to some sources, the world's largest hedge fund will only expose itself through crypto funds for the time being.
Billionaire Ray Dalio is the founder of the world's largest hedge fund, Bridgewater Associates, and was one of the 100 richest people in the world for several years. Although the investor is not a fan of fiat money, he has repeatedly spoken negatively about Bitcoin. Over the past year, however, Dalio changed his mind. In May 2021, the hedge fund manager personally acquired Bitcoin for the first time, and less than a year later Bridgewater is also preparing to invest in crypto funds.
Ray Dalio's position on bitcoin
In the past, Ray Dalio distanced himself from cryptocurrencies with various statements. He expressed skepticism about Bitcoin and listed various disadvantages of the cryptocurrency. After all, he said, the crypto asset is excessively volatile and he has concerns that Bitcoin could be banned by various governments. At the World Economic Forum 2020 in Davos, he expressed himself as follows.
"There are two purposes of money: A medium of exchange and a storeholder of wealth. And Bitcoin is not effective in either of those cases now." - Ray Dalio, Founder of Bridgewater Associates
In the meantime, his attitude towards Bitcoin has changed drastically. In an interview with MarketWatch, he described Bitcoin as a great discovery. He has faith in blockchain technology, he said, and Satoshi's invention undoubtedly deserves recognition. As an outspoken fiat opponent and gold investor, this development was not entirely unexpected by many. With the slogan "Cash is Trash," he had already been advocating hard assets that cannot be diluted by any central authority for decades.
Birdgewater with a leg up in the crypto world
It is the clearest signal yet that the world's largest hedge fund is taking crypto seriously as an asset class. Still, the size of Bridgewater's investment is negligible compared to its total assets under management (AUM). According to a Bridgewater representative, the firm currently has no plans to invest directly in cryptocurrencies, but wants to actively engage in research on crypto and blockchain.
"While we won’t comment on our positions, we can say Bridgewater continues to actively research crypto but is not currently planning on investing in crypto." - Bridgewater representative
Bridgewater is taking a similar path to London-based hedge fund Marshall Wace and Brevan Howard, who are reportedly building their own crypto funds. The sources did not reveal details, but still agreed to a rough timeline for Bridgewater's crypto debut, letting it be known that the hedge fund giant plans to enter the space by mid-2022. Apparently, the plan is to invest a small portion of their fund directly in digital assets in the first half of the year.
