In the last seven days, Bitcoin remained bullish as its price moved up beyond the $16,000 mark. Amidst this positive narrative about Bitcoin’s price, American billionaire Ray Dalio suggests the cryptocurrency may be outlawed by the government.
According to Dalio, Bitcoin’s price surge will force the government to place a ban on it. In an interview with Yahoo Finance, Dalio spoke extensively on several issues with Bitcoin that would lead the government to eventually hamper its growth.
Why the Government may Outlaw Bitcoin – Dalio
In his sentiments, it can be perceived that the hedge investor was only doubling down on his skepticism about Bitcoin.
The billionaire clearly stated that Bitcoin isn’t a good alternative asset and why the government would ban it. Dalio indicates how one problem with BTC is its high volatility and inability to be spent on everyday goods.
According to him, people are going to choose the emerging Central Bank Digital Currencies (CBDCs) in favor of Bitcoin.
“Theoretically, Bitcoin is good, but there are three basic things. A currency ought to be an effective medium of exchange, a storehold of wealth, and the governments can control it. Bitcoin does not tick any of these three boxes in its current shape.”
Dalio is struck by how people cannot easily buy anything with Bitcoin yet. Bitcoin volatility cannot make it a useful store of wealth either. In his argument, Dalio utters that a governmental outlaw is imminent.
“And they’ll (governments) use whatever teeth they have to enforce that, they’ll say you can’t transact a Bitcoin, you can’t have it,” he said. “Then you’d have to be like, is it a felony, am I gonna be a felon?”
He also draws some parallels between gold and Bitcoin. While Ray clearly favors bullion, he thinks it is being “controlled” by governments, just like Bitcoin will be in the future.
Jack Dorsey Refutes it all
After Dalio’s attack on Bitcoin and claims that it could be outlawed, the crypto community has continually fired back.
Twitter CEO Jack Dorsey responded to Dalio’s claim with a resounding “NO.” Previously, Jack has said that Bitcoin is probably the best native currency of the internet.
— jack (@jack) November 15, 2020
Similarly, Jack’s firm Square recently purchased 4,709 BTC (worth $50 million at the time) which represents 1 percent of the firm’s total assets.
Bitcoin bull Raoul Pal has dismissed any claim that governments would outlaw Bitcoin. He said such an act would be futile.’After all, Bitcoin is not controlede by anyone, and it cannot be “shut down” either.
Why the Government Cannot Outlaw Bitcoin – Raoul Pal
In an interview with Bankless, Raoul said a ban on Bitcoin would be futile as likened it to a ban on gold back in the ’90s.
He said that during the era of Franklin Delano Roosevelt (FDR), the government forbade the hoarding of gold coins, bars, and certificates in 1933. The effort backfired as people resulted to other means of getting gold. In his opinion, a similar thing will happen if Bitcoin is outlawed.
He adds that the government would soon begin adding Bitcoin to their reserves as fiat currencies around the world continue to face devaluation.