Bitcoin – Here’s why Ray Dalio believes in crypto’s odds as ‘legit hedge’ in 2025
Key Takeaways
Bitcoin is now gaining credibility as a hedge whereas the Federal Reserve faces a debt-driven dilemma.
The U.S debt is at traditionally excessive ranges proper now.
On the time of writing, America’s debt pile stood at $37.3 trillion. Notably, the US spends about $1 trillion a yr simply on curiosity and wishes one other $9 trillion to roll over present debt, plus roughly $2 trillion extra to cowl the deficit.
Holding this in thoughts, hedge fund billionaire Ray Dalio has warned that this sample might push America in direction of a debt-induced “coronary heart assault” inside the subsequent three years. Therefore, the query is – The place does that depart Bitcoin [BTC]?
Mounting debt places greenback and bonds on shaky floor
Debt is inevitable, however servicing it is dependent upon nationwide revenue.
Curiously, the usbudget deficit surged by almost 20% in July to $291 billion, even after a $21 billion bump from tariffs. Principally, income can’t sustain with spending – An indication that the fiscal system could also be below severe stress.
The fallout? The U.S. Greenback Index [DXY] has dropped by roughly 11% over the previous seven months to 98.386, signaling that traders could also be shedding religion within the greenback as a dependable retailer of worth.
Supply: TradingView (DXY)
The U.S. bond market is feeling it too.
The 30-year Treasury yield spiked by almost 5%, marking ranges not seen since earlier than the 2008 disaster. As well as, the 10-year yield hiked to 4.22%, up from 3.84% a yr in the past, signaling a steepening yield curve.
Merely put, capital is perhaps transferring away from conventional protected havens as U.S financial progress exhibits indicators of slowing down. On this context, might Bitcoin’s 18.76% positive factors in 2025 now function the market’s go-to protected haven?
Fed stress increase Bitcoin’s case as a hedge
Macro volatility is clearly driving flows into different belongings.
Certain, Bitcoin’s 19% YTD positive factors backed up its “retailer of worth” story, however Gold [XAU] has been stealing the highlight with a large 35.12% surge to this point in 2025, Actually, it beat its annual positive factors over the previous eight years too.
This marks a key divergence from earlier cycles. The Fed remains to be hawkish on charge cuts, but capital retains flowing into Bitcoin – An indication that traders could also be beginning to see it as a legit macro hedge.
Supply: TradingView (BTC/USDT)
That might assist clarify why Bitcoin’s worth rallied, regardless of tariff pressures.
With U.S debt rising and stress on the greenback and Treasuries, the Fed is caught – Hike charges and threat a debt crunch, or print cash to maintain charges low, one thing that might weaken the greenback and spark inflation.
Amid all this macro chaos, Bitcoin is now rising because the go-to hedge.
