Ray Dalio says regulators will 'kill' Bitcoin over its success

Billionaire Ray Dalio said regulators will try to 'kill' Bitcoin if it gains mainstream success. Yahoo Finance's David Hollerith weighs in.

Video transcript

- Turning now to the topic of crypto. Bridgewater Associates founder, Ray Dalio, issued a sharp warning about Bitcoin at the SALT Conference of hedge fund managers yesterday. Now, specifically, Dalio was pointing to the threat of regulation and what that might mean for digital tokens. Now, for more on this, we have Yahoo Finance's own, David Hollerith, here to break it down for us. David, what's the latest?

DAVID HOLLERITH: Hey, yeah. So, I believe it was yesterday, Dalio said at the SALT Conference that he's actually reoriented this. He said this a few times, that cryptocurrency, Bitcoin in particular, is a viable asset class and interesting for diversifying a portfolio. However, if it's too successful, then regulators will likely ban it. So, you know, there's a lot of ifs there, obviously.

So, what too successful means is kind of, Dalio's a much longer term thinker. So, it's sort of hard to understand it, but he does own cryptocurrency. He also said that he owns more gold than Bitcoin. So, take that with what you will.

But I think this comes in light of all these regulatory crackdowns we've seen in the industry. The hearing of Chair Gensler, Chairman of the SEC, on Tuesday. And I think what we're looking to see is what will actually happen in terms of US regulation. And I think Dalio is a little bit-- he's a little bit weary of that.

BRIAN SOZZI: David, really, at the heart of this, it continues to be that, you know, the government hasn't really established a clear or strong framework for crypto. It's time, right?

DAVID HOLLERITH: Yeah, yeah. I mean, I think it is. And you know, I've heard a lot of different perspectives on this. And initially, there's a lot of grumbling from people in the industry, but I've also heard some positive perspectives on. And one way to look at this is that the SEC has in some ways been a little bit asleep at the wheel on this, and for the past five, six years.

So, they've allowed the industry to grow a lot more. And now, coming in and handing down clearer regulations, I think it helps cryptocurrency businesses a lot, because right now, I think what a lot of businesses need, if they do want to play by the rules, is just a clear, proactive guidance from the SEC.

- All right, thank you so much for that update. Yahoo Finance's own, David Hollerith.