The US dollar is caught in a structural depreciation; Bitcoin may become an alternative asset — Interpreting Dalio's macro analysis

Source: TokenPost Original Title: Ray Dalio: “Dollar Enters Structural Weakness… Potential Rise of Bitcoin as an Alternative Asset” Original Link:

The Full Picture of the US Dollar’s Structural Depreciation

Renowned investor and Bridgewater Associates founder Ray Dalio points out that the US dollar is facing a long-term, structural depreciation trend, which could mark an important turning point for the cryptocurrency market.

Between 2025, the dollar is expected to fall 39% against gold, 12% against the euro, and 13% against the Swiss franc. Dalio comments, “The biggest market trend this year is the largest decline in the weakest fiat currencies and the biggest rise in the strongest currencies.” Data shows that gold, priced in USD, has increased by 65%, surpassing the S&P 500 index by 47 percentage points; the S&P 500, priced in gold, has fallen 28%; European stocks have outperformed US stocks by 23%, and Chinese stocks lead by 21%. This reflects a global capital shift from US assets to other investment targets.

The Fundamental Causes of Dollar Depreciation

Fiscal Imbalance and Monetary Policy

Dalio states that the fundamental reasons for dollar depreciation include:

• Structural Fiscal Imbalance: The US needs to roll over approximately $10 trillion in debt, putting long-term asset attractiveness under pressure
• Shift in Monetary Policy: The Federal Reserve’s rate cuts and artificially lowered real interest rates weaken the appeal of long-term assets
• Steepening Yield Curve: In early 2026, the spread between 2-year and 30-year US Treasury bonds reaches 140 basis points, the steepest since 2021

Market interpretations suggest that this curve shape reflects expectations that short-term benchmark interest rates may decline, while long-term rates need to be higher to compensate. The widening yield spread indicates “long-term inflation uncertainty,” “fiscal deficit concerns,” and “expanded government bond issuance.”

Geopolitical and Trade Policy Risks

Dalio points out that dollar depreciation is also driven by:

• The shift in US policies towards a full-scale capitalist experiment, where fiscal expansion and deregulation may stimulate growth in the short term but could exacerbate wealth inequality
• The global shift from multilateralism to unilateralism, with rising trade protectionism and de-globalization sentiments
• Sanctions threats weaken the international status of the dollar, boosting gold demand and reducing dollar demand

Opportunities in Cryptocurrency

Against this macro backdrop, cryptocurrencies are seen as potential alternative assets:

Bitcoin as a Hedge: A compliance platform CEO emphasizes that Bitcoin can serve as a counterbalance to the dollar and pressure US policymakers to promote sound fiscal management.

Market Signals: VALR co-founder notes that as gold and silver soar by 69% and 161% respectively, long-term Bitcoin holders are ceasing to sell, described as “calm before the storm”—a pattern often preceding crypto bull markets historically.

Price Expectations: If precious metals’ rally slows, capital may flow back into cryptocurrencies. Predictions suggest Bitcoin could reach $130,000 in Q1 2026, and Ethereum could hit $4,500.

Currently, Bitcoin trades at approximately $91,000, down 1.5% recently.

Key Takeaways

• Dollar depreciation reflects US fiscal imbalance and policy shifts
• Global capital flows are shifting from US assets to physical assets like gold
• Trade protectionism and geopolitical tensions intensify pressure on the dollar
• Bitcoin’s value as an inflation hedge and policy oversight tool is rising
• The rally in precious metals may eventually trigger capital transfer to cryptocurrencies