Ray Dalio Warns of U.S. Debt Crisis and Recommends Gold and Bitcoin as Protection

Ray Dalio, founder of Bridgewater Associates, published an article on his social media last Friday (21) warning about the U.S. debt crisis. As a recommendation for his followers, the billionaire cites gold and Bitcoin as a form of protection.

This is not the first time the legendary investor has recommended cryptocurrency. Last year, the billionaire mentioned that 15% in gold or Bitcoin would be good for a portfolio.

Ray Dalio expresses concern about the growth of American debt.

In his book 'How Countries Break: The Great Cycle', published in 2025, Ray Dalio explains that countries go through a decades-long cycle where debt, income, interest, credit, and money issuance evolve in a relatively predictable manner.

In his view, the U.S. would be entering the final stage of this cycle in the coming years if the situation does not improve.

Putting numbers on the table, Dalio points out that American revenue will be $5.5 trillion this year, but expenses will reach $7.5 trillion. In other words, a budget deficit of $2 trillion.

"Thus, this year, your organization's spending will be about 40% higher than its revenue. And there is little capacity to cut expenses because almost all spending is already committed or essential."

Continuing, Dalio explains that the government needs to pay both the interest and the debt itself unless it is bought back.

"Therefore, debt service payments, that is, the payment of principal and interest necessary to avoid default, total about $11 trillion, equivalent to approximately 200% of the money coming in."

Citing independent projections from third parties, the billionaire points out that debt will reach $55-60 trillion in 10 years, about seven times the amount coming into the government.

Currently, total debt stands at $40 trillion, or $32 trillion, excluding intragovernmental holdings.

In conclusion, Dalio provides a sort of summary of his book, answering a series of questions for the reader to understand why these crises happen, why they repeat, how concerned investors should be, and what could trigger a debt crisis in America today.

Although he has already recommended 15% exposure to gold or Bitcoin, Ray Dalio revealed at the end of 2025 that he only holds 1% of cryptocurrency in his portfolio. At that time, he explained that he keeps open questions about Bitcoin and, therefore, does not increase his position.

Regardless, the billionaire reiterated Bitcoin, alongside gold, as a protection against the American debt crisis.

"As a general guideline, I suggest diversifying well among asset classes and countries that have solid earnings reports and balance sheets and are not facing major internal political conflicts or external geopolitical issues, reducing exposure to debt assets like bonds, and increasing exposure to gold and, to a lesser extent, Bitcoin. Keeping a small percentage, perhaps 10-15%, of wealth in gold can reduce portfolio risk and, in my opinion, also increase returns."

Regarding investing in other countries to escape the U.S., Dalio explains that the United Kingdom, European Union, China, and Japan have similar problems, which is why gold and Bitcoin may perform relatively well in the future.

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