Thread by @hasufl

Some money quotes in Dalio's note on Bitcoin

"It seems to me that Bitcoin has succeeded in crossing the line from being a highly speculative idea that could well not be around in short order to probably being around and probably having some value in the future." (p1)

Dalio challenges the idea that Bitcoin is as scarce as people think, since there is an unlimited number of "Bitcoin-like assets". More innovative coins can probably carve out their own demand, and arguably we are already seeing that today. (p1)

Though Dalio knows about the ability to hold coins in cold storage, he's still concerned about the ability to shield them against cyber attacks and hold them securely. He warns that increasing digitization also increases systemic risk. (p2)

Dalio thinks that Bitcoin's achilles heel is its lack of privacy. While very experienced users can use it privately, most people can't, and that would make it easy for governments to prevent wide-spread adoption as money. (I fully agree.) (p2)

By the way, Dalio with the shot against S2F type models: "Since the supply is known, one has to estimate the demand to estimate its price."

To end, here are the two money quotes:

"[...] Bitcoin looks like a long-duration option on a highly unknown future that I could put an amount of money in that I wouldn’t mind losing about 80% of."

"[we] expect Bridgewater to soon offer an alt-cash fund and a storehold of wealth fund in order to better deal with the devaluation of money and credit that we consider to be a major risk and opportunity, and Bitcoin won’t escape our scrutiny." - Dalio

Full report out now bridgewater.com/research-and-i…