Ray Dalio’s Bridgewater Plans To Back Crypto Fund For The First Time: Report

  • Bridgewater Associates plans to back its first crypto fund, CoinDesk reported on Monday.
  • Ray Dalio’s hedge fund does not currently plan to invest directly in cryptocurrencies, according to the report.
  • The investment is small compared to Bridgewater’s $150 billion in assets under management, according to its source.

Ray Dalio’s Bridgewater Associates plans to back a crypto fund for the first time, CoinDesk reported Monday.

The hedge fund is set to invest in an external crypto vehicle, but it does not currently plan to invest directly in crypto assets itself, according to the report, citing unspecified sources.

This is the first indication that the world’s largest hedge fund, with nearly $150 billion in assets under management, is embracing digital assets. This also underscores the solidification of interest in crypto among major financial institutions.

But Bridgewater’s investment in the crypto fund — which could go ahead in the first half of 2022 — is minimal compared to the assets it manages, according to a CoinDesk source.

“They plan to deploy a small portion of their fund directly into digital assets,” the source told the outlet.

Other prominent crypto investors are also said to back the fund. Bridgewater did not immediately respond to Insider’s request for comment.

In a January research report, Connecticut-based Bridgewater said it believes “crypto markets are now large enough to accommodate positions of relevant sizes for institutional investors.”

The institutional space is rapidly changing and several hedge funds are getting into digital assets. Last year, London-based investment firm Marshall Wace was looking to raise a new fund to invest in blockchain technology, digital currency payment systems and stablecoins.

Billionaire Steve Cohen’s Point72 Ventures has already made five investments in the crypto sector, with plans to start investing in tokens this year.

Dalio, the founder and co-chief investor of Bridgewater, hasn’t always been open to cryptocurrencies. He called bitcoin a bubble in 2017, and three years later outlined three reasons why it can’t serve as an effective currency.

But he changed his mind in 2021 and went so far as to praise the leading cryptocurrency for its resilience.

“It wasn’t hacked. It wasn’t made obsolete. It turned out to be an asset that has imputed value,” he told Insider in a December interview. “It’s probably the next-gen version of gold.”

Dalio separately revealed in December that he owns ether in addition to bitcoin, saying cryptocurrencies are a “relatively small part” of his portfolio.

Allocating up to 2% of your portfolio to bitcoin is a reasonable bet, he believes.

Read more: Paulina McPadden’s global equity fund has been the best in the world for 3 years. She explains why only a few stocks really matter to investors – and details the 3 that are most important to her.

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