Ray Dalio Urges Shift to Gold and Bitcoin as U.S. Debt Hits $40 Trillion

The U.S. government’s financial position has reached a precarious inflection point, according to Dalio, who warned that the current debt burden could soon become difficult to manage without triggering significant economic pain. His strategy centers on broad diversification across countries and asset classes that maintain strong balance sheets. By underweighting debt-based assets like bonds and favoring gold—with a secondary, smaller position in Bitcoin—investors may lower portfolio risk during periods of fiscal stress.

This guidance arrives as Bitcoin rallies toward $80,000, fueled by a combination of forced short liquidations and massive capital inflows into U.S. spot ETFs. While Dalio views Bitcoin as a viable alternative to conventional debt markets, he continues to favor gold for its historical liquidity and central bank acceptance. Meanwhile, the Treasury Department is attempting to manage the ballooning debt by doubling its buyback operations for long-dated securities to $4 billion per session, a move intended to provide liquidity in a strained bond market. With the Federal Reserve signaling continued concern over inflation, the interplay between government borrowing and volatile risk assets remains a focal point for institutional investors.