Ray Dalio, the American billionaire and head of the world's largest hedge fund, Bridgewater Associates has called Bitcoin ‘one hell of an invention,’ adding that he viewed it as a ‘gold-like alternative asset.’

“I believe Bitcoin is one hell of an invention,” said Dalio. “To have invented a new type of money via a system that is programmed into a computer and that has worked for around 10 years and is rapidly gaining popularity as both a type of money and a storehold of wealth is an amazing accomplishment,” he said.

The hedge fund manager was of the view that much like the bankers who had invented credit in the Middle Ages, the Bitcoin is making early believers very rich.

“Those who have built it and supported the dream of making this new kind of money a reality have done a fabulous job of sustaining that dream and moving Bitcoin (by which I mean it and its analogous competitors) into being an alternative gold-like asset,” he said.

On the issues pertaining to Bitcoin and digital currencies as a whole, Dalio pointed out “to one holding digital/cyber assets at a time when cyber offense is much more powerful than cyber defense, the cyber risk is a risk that I can’t ignore.”

“When the Department of Defense can’t protect its systems from being hacked it would be naïve to be totally comfortable that digital assets can’t be hacked, which is one of the advantages of gold-like assets and is one of the risks of all financial assets.”

“In fact I think that there is a good chance that someday we will see the financial system, which consists mostly of digits, be shown to be more vulnerable to disruption and/or to cyber blackmail than is now recognized,” he added.

Regarding the privacy concerns, Dalio opined that it appears that Bitcoin will unlikely be as private as some people surmise. “It is, after all, a public ledger and a material amount of Bitcoin is held in a non-private manner. If the government (and perhaps hackers) want to see who has what, I doubt that privacy could be protected. Also, it appears to me that if the government wanted to get rid of its use, most of those who are using it wouldn’t be able to use it so the demand for it would plunge. Rather than it being far-fetched that the government would invade the privacy and/or prevent the use of Bitcoin (and its competitors) it seems to me that the more successful it is the more likely these possibilities would be.”

Amid all the uncertainties revolving around Bitcoin, Dalio expressed that “Bitcoin looks like a long-duration option on a highly unknown future that I could put an amount of money in that I wouldn’t mind losing about 80% of.”