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Bridgewater Associates founder Ray Dalio attends China Development Forum 2019 at the Diaoyutai State ... [+] Guesthouse on March 23, 2019 in Beijing, China.

Billionaire investor and Bridgewater Associates founder Ray Dalio was interviewed by CNBC as part of their coverage of the World Economic Forum in Davos on Tuesday morning. During the interview, Dalio painted a picture of the global economy that sounds quite similar to the supporting evidence Bitcoin investors often provide in terms of their bullish scenarios for the cryptocurrency.

While his general thesis on what will happen with the economy in the coming years matches up with what many Bitcoin holders think, Dalios advice for those worried about tough economic times ahead is to turn to gold, rather than Bitcoin, as a safe haven asset.

According to Dalio, the global economy is facing a serious issue in that an economic downturn would be an especially problematic situation for central bankers due to the lack of tools that are available to use, with interest rates already at or near historical lows in many places around the world.

Were in a spot in monetary policy where you can no longer stimulate the same way you did before, said Dalio.

Additionally, Dalio sees larger budget deficits on the way. In his view, newly-printed money will be used to pay for this increased spending. Dalio added that this scenario does not necessarily mean there will be an acceleration of inflation, as the new money could be funneled into financial assets.

The way it works is: They print money, they buy a bond, they give it to the seller of the bond, and they buy other financial assets, said Dalio.

However, Dalio stated that the attractiveness of government bonds to investors could decline in the coming years, creating new questions regarding what works best as a store of value.

When you get negative-yielding bonds or something, youre approaching a limit, said Dalio. We are approaching a limit that will be a paradigm shift, I think.

In terms of the possibility of an economic downturn during the next U.S. Presidential term, Dalio claimed, Its going to happen.

When this economic downturn occurs, Dalio is of the belief that turning to cash wont be the best option.

You cant jump into cash, said Dalio. Cash is trash . . . because theyre going to print money.

This same sentiment is behind many of the bullish Bitcoin price scenarios that have been espoused over the past couple of years.

While Dalio agrees with Bitcoin proponents in terms of the potential issues with holding cash in the near future, the billionaire investor disagrees that the cryptocurrency would be a proper alternative as a store of value.

In Dalios view, a global portfolio with a certain amount of money put into gold as an additional diversifier will be the best option for investors to deal with the economic downturn that he foresees happening in the coming years.

If you want to oversimplify a portfolio, you probably want stock in the technology, disrupting companies and some gold, said Dalio.

When asked if Bitcoin should also be included in this portfolio, Dalio said no.

There are two purposes of money: a medium of exchange and a store-hold of wealth, explained Dalio. And Bitcoin is not effective in either of those cases now.

In Dalios view, Bitcoin is simply too volatile to act as a proper store of value, and over the long term, he sees more potential in something like Facebooks Libra project. That said, there is reason to believe the level of centralization found in Libra and various central bank digital currency projects would actually have a positive effect on Bitcoin.

But also: Who is going to do the buying? added Dalio. Central bankers and others. What are they going to hold as reserves? What has been tried and true? Are they going to hold digital Bitcoin? Theyre going to hold gold. That is a reserve currency, and its been a reserve currency for a thousand years.

Despite Dalios comments, data from the second half of 2019 appears to show Bitcoin has made progress in terms of becoming viewed as a digital gold by market participants. A potential continuation of this trend is one of the five key Bitcoin stories to watch in 2020.

That said, while a survey from last week indicated more financial advisors are looking to add Bitcoin and other crypto assets to client portfolios in 2020, this is still a rare point of view among institutional investors. However, an improving regulatory environment around Bitcoin is one of the reasons an analyst has stated theres a 60% chance for a Bitcoin ETF approval to occur in 2020.

Additionally, a variety of factors have already led one industry executive to predict a $50,000 Bitcoin price by the end of the year.

Read more:
Billionaire Investor Sees Major Flaw In Bitcoin Investment Thesis - Forbes

DAVOS Switzerlands banking industry has long been known to privately safeguard wealth, so some bankers see bitcoin as a natural fit for the nations financial sector.

Although such bankers may still be a minority, Zurich-based SEBA Bank AG opened in November 2019 with a universal banking license and a suite of services ranging from fiat storage to crypto custody, a crypto-connected debit card that automatically converts to fiat on the backend for regular shopping and crypto-trading options through the banks mobile app.

SEBA CEO Guido Bhler said the bank raised 100 million Swiss francs (roughly $103.4 million) from angel investors like Guy Schwarzenbach, founder of Black River Asset Management.

Schwarzenbach said the pricing for SEBA app trades, enabled by backend API integrations with global exchanges, offered extremely competitive pricing compared to over-the-counter trades.

What I am really excited about for SEBA is their upcoming deployment of a margin and lending business, including options and derivatives, Schwarzenbach said.

SEBA was hardly the first bitcoin-friendly Swiss bank. The private bank Falcon Group, for example, launched bitcoin management services in 2017. Matthew Blake, the World Economic Forum's monetary systems lead, described crypto-friendly, fully licensed banks as an emerging trend.

"It's something institutions can do to hedge," he said.

Likewise, the Swiss crypto startup Bitcoin Suisse has also applied for a universal banking license with the goal of offering everything from staking services to loans.

We're not applying for a banking license just to be like every other bank. We are pioneers at heart, said Bitcoin Suisse marketing lead Ian Simpson. We will, of course, offer cash accounts for our clients, in their own name. ... We will be able to start trading crypto securities, stablecoins and synthetics, such as mini-futures and products to short the major crypto assets.

Crypto bank

However, among such banks so far, SEBA offers a unique ability to hold a variety of many fiat currencies, including American dollars, Hong Kong dollars and Singaporean dollars, then instantly trade cryptocurrencies like bitcoin, ether and Stellar lumens.

You can open an account over the phone in 15 minutes, for an accredited investor, you dont have to go to Switzerland, Bhler said. Theres always going to be aspects that banks are required for, and the first one is the storage of your private key.

For Schwarzenbach, who described himself as a libertarian who runs his own Lightning Network node that he made using a Raspberry Pi, bitcoin banking makes sense for the physical security benefits. He wouldnt want the risk of someone hurting him to get at his bitcoin stash.

Bhler said the young bank already serves high-net-worth individuals and institutional investors from all over the world, excluding the United States, plus a few blockchain startups.

Schwarzenbach added that open source decentralized finance (DeFi) platforms inspired by MakerDAO could eventually offer comparable financial infrastructure to both the general population and the proverbial 1 percent.

My hope is that we will be able to develop and adopt that [DeFi] infrastructure, Schwarzenbach said. And it is my expectation that standards will present themselves with market maturation.

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Read more:
Swiss Banks Enter the Age of Bitcoin - CoinDesk

2019 was marked by some of the worlds most powerful people talking about Bitcoin in public settings.

President Donald Trump said in a surprise Twitter thread that cryptocurrencies, from BTC to Libra, are no something he is a fan of, citing their potential to be used in crime. Teslas Elon Musk said in a podcast that he thinks Bitcoins structure is brilliant and other digital assets may have some merit.

It seems that this trend of large investors and entrepreneurs talking cryptocurrency has continued to the new year. This time, its Ray Dalio, co-founder of Bridgewater Associates, the worlds largest hedge fund.

At the World Economic Forum in Davos, Ray Dalio sat down with CNBC to talk markets, specifically regarding monetary policy and how it relates to gold.

While the conversation was centered around gold, Dalio touched on Bitcoin. Unfortunately for fans of cryptocurrency, he didnt sing the praises of the cryptocurrency.

Halfway through the interview, he said that he thinks Bitcoin currently does not satisfy the two leading use cases of money, store of value and medium of exchange, due to market volatility.

Dalio added that because of this, central banks are unlikely to hold the cryptocurrency, but will instead hold gold.

This is notable as Dalio wrote in a jaw-dropping LinkedIn post last year that he thinks the system is broken, citing the rampant levels of debt, wealth inequality, and central banks propensity to print money.

While Dalio and others are insistent that Bitcoin is not a viable store of value or medium of exchange, a number of analysts are convinced 2020 will be the year institutional players invest large sums of capital into the crypto markets.

Per previous reports from this outlet, Changpeng CZ Zhao, CEO of Binance, has reported that his firm has seen an increase in institutional excitement for cryptocurrency.

Also, Peter Johnson, a Principal at crypto-friendly venture capital firm Jump Capital, said that global macro investors, who focus on long-term narrative shifts on an Earth-wide scale, will begin to siphon capital into Bitcoin due to changes in the macroeconomic and geopolitical environment.

Not to mention, 2019 already saw a number of institutions start to dabble in cryptocurrency investment.

The parent company of the New York Stock Exchange headed a Bitcoin derivatives exchange in Bakkt, which has seen dramatic institutional adoption since its launch.

Also, Fidelity Investments one of the worlds foremost asset managers and financial service firms unveiled a Bitcoin custody and trade execution division for its thousands of clients. The company is in the midst of rolling out this service worldwide to service trillions of dollars worth of assets.

Read the rest here:
Heres Why Wall Street Veteran Thinks Bitcoin Isnt a Viable Money, Yet - newsBTC

Grayscales Bitcoin Trust now reports to the United States Securities and Exchange Commission (SEC), putting it one step closer to public trading.

Grayscales Bitcoin Trust manages investment in Bitcoin on behalf of investors, exposing them to the coins potential for gains while mitigating risks. The Jan. 21 announcement advertises the trust as the first of its kind to report to the SEC.

Grayscales full Form 10 is available here. Subsequent to this registration, the trust will need to file quarterly and annual reports with the SEC, which will then become publicly available. In response to an inquiry from Cointelegraph, Grayscale declined to specify just when it will file the first of these reports but said the firm will do so in accordance with SEC regulations.

While a Form 10 filing is not enough for a company to begin trading publicly on exchanges, it is a step in that direction and opens the trust up to more investors than were previously available without registration.

In the announcement, the firm makes particular mention of accredited investors a controversial designation. Owning or purchasing shares from the Trust's private placement gives them the advantage of quicker liquidity with a reduced holding period of 6 months.

Grayscales announcement arrives as the SEC considers changes to its accredited investor designation, couched in the 1934 acts Section 12(g).

Effectively, the SEC trusts the wealthy or executive class to invest with insight and thereby minimal risk. Conversely, the Main Street investor, the decades-old moniker assumes, lacks this insight. Under SEC exemptions companies may offer shares to accredited investors without filing all documents that the SEC requires of publicly-listed companies. Critics castigate this exemption as favorable to the rich while being exclusionary of everyday investors, whom former SEC commissioner Michael Piwowar dubbed forgotten investors.

Continued here:
Now Reporting to the SEC, Grayscale Bitcoin Trust One Step Closer to Public Trading - Cointelegraph

Binance and BitMEX were the two cryptocurrency exchanges that managed to greatly increase their Bitcoin holdings in 2019, according to a new report released by crypto analytics company CoinMetrics.

Meanwhile, Poloniex, the crypto trading platform that was acquired by an unnamed Asian group back in October, witnessed a severe decline in its total BTC supply.

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Poloniex, which was acquired by Circle for a whopping $400 mln in February 2019, went from one of the most popular exchanges to an almost irrelevant platform that turned into a promotional platform for Tron after its spinout. Justin Sun, the CEO of Tron, himself confirmed that he himself invested in the exchange after trying to distance himself from the deal.

The graph below vividly shows how the number of users online continues to decline in tandem with the exchange's BTC reservers.

BitMEX and Poloniex were both founded in 2014 but the former managed to take off and became the dominant exchange due to the popularity of crypto derivatives. Neither the CFTC nor more than 20,000 leaked emails prevented the Seychelles-based giant from hogging more BTC.

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It is worth noting that the report doesn't include America's number one exchange Coinbase that is estimated to control more than five percent of Bitcoin's total supply after acquiring Xapo.

As reported by U.Today, cryptocurrency exchanges are now estimated to control more than 10 percent of all existing coins.

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These Two Crypto Exchanges Greatly Increased Their Bitcoin (BTC) Reserves in 2019 - U.Today