Ray Dalio, an American billionaire investor who has been the Co-Chief investment officer of Bridgewater Associates, the world's largest hedge fund, since 1985. According to him, the digital Yuan will be more competitive than the digital Dollar.
Dalio told CNBC on Monday that he believes the United States would issue a digital dollar one day and that it "will surely be sustainable." However, it will not be the most competitive, as its value may be impacted by rising US debt levels, he added.
Dalio, on the other hand, believes that the digital yuan will be more competitive in terms of pricing and return. If it is recognized internationally and offers attractive interest rates, it will be a "really viable alternative" for many investors, he claims.
"I think we're going to enter a world where individuals will be thinking about which currency to use, and the ones with the strongest fundamentals will be the ones that are most competitive and will pose a danger to countries," Dalio predicted.
Dalio also believes that China's yuan would overtake the US dollar as the world's reserve currency sooner than expected.
China is currently the world's greatest trade nation, which means it is the top exporter and importer. Dalio anticipates that the yuan will be used in more commerce and financial operations.
"I believe the renminbi will become a more significant currency, a stronger currency, a more stable currency, a more attractive-returning currency, and a more extensively utilized currency... in the years ahead," Dalio said.
Dalio anticipates that China's yuan share would rise to roughly 10% to 15% in the next five to ten years. After more than six years of research and development, China is nearing the introduction of its digital yuan.
The United States has only recently begun to consider developing a digital version of its currency.