BlackRock CEO Larry Fink has warned that the dollar could lose its status as the world's reserve currency to Bitcoin or other digital assets if the US does not manage its debt effectively.
In his annual Chairman's Letter to Investors, Fink praised "decentralized finance" as a significant innovation that makes "markets faster, cheaper and more transparent."
However, he warned that this innovation could diminish the US economic advantage if investors begin to view Bitcoin as a safer option than the dollar.
As reported by Trading Economics, US debt reached 122.3% of the country's GDP in 2023, up significantly from 105% in 2018.
Although Moody's Ratings maintains the US's AAA credit rating, its outlook has been downgraded to negative, suggesting a possible future downgrade.