Rebecca Patterson, director of investment research at Bridgewater Associates , told Bloomberg under what conditions the world’s largest hedge fund can invest in bitcoin.
According to her, the primary criterion is to reduce volatility. “Bitcoin can now move 10% of one tweet. This is not quite a store of capital for most institutional investors, she said, noting that Bitcoin is ten times more volatile than the US dollar and even twice the Venezuelan bolívar. “We need a decrease in volatility, a more stable asset so that it can be viewed as a means of preserving capital, a diversifier.”
The second factor, according to a Bridgewater spokeswoman, is increased liquidity, and the third is regulatory certainty.
“The more the regulatory ecosystem develops around bitcoin and other cryptocurrencies, the more types of investors will be ready to join them. This will provide liquidity and reduce volatility, Patterson said. “If I was asked to monitor one of the factors, it would be regulatory certainty, and I don’t know when it will arise in the US.”
Patterson also noted that she does not consider bitcoin as a currency, but admitted that over time it could acquire the status of digital gold.
Bridgewater founder Ray Dalio, a past critic of cryptocurrency, recently announced that bitcoin will not “escape the attention” of his company.