Billionaire investor and Bridgewater Associates founder Ray Dalio says the worldwide order established after World Warfare II is breaking down. He argued that the world is coming into what he calls “Stage 6” of the “Big Cycle.”
His warning has triggered renewed debate about geopolitical instability and its affect on cryptocurrency markets.
Sponsored
Ray Dalio Says We’re in “Stage 6” as World Order Breaks Down
Dalio frames the present second by way of what he calls the “Big Cycle.” It is a sample during which dominant empires rise, peak, and finally decline. In accordance with this mannequin, the world is now in “Stage 6.”
“In my parlance, we are in the Stage 6 part of the Big Cycle in which there is great disorder arising from being in a period in which there are no rules, might is right, and there is a clash of great powers,” the submit learn.
In contrast to home political programs, Dalio argues, worldwide relations lack efficient enforcement mechanisms equivalent to binding legal guidelines or impartial arbitration. Because of this, world affairs are in the end ruled by energy quite than guidelines. When a dominant nation weakens and a rival positive factors power, tensions sometimes improve.
He identifies 5 forms of battle that are likely to escalate in such intervals: commerce and financial wars, expertise wars, capital wars involving sanctions and monetary restrictions, geopolitical struggles over alliances and territory, and eventually, navy wars.
Most main conflicts, he argues, start with financial and monetary strain lengthy earlier than bullets are fired. Dalio attracts comparisons to the Nineteen Thirties, when a world debt disaster, protectionist insurance policies, political extremism, and rising nationalism preceded World Warfare II.
He notes that earlier than large-scale navy battle erupted, nations engaged in tariff battles, asset freezes, embargoes, and monetary restrictions, ways that resemble measures used right now.
Sponsored
In his view, probably the most vital flashpoint within the present cycle is the strategic rivalry between the USA and China, notably over Taiwan.
“The choice that opposing countries face—either fighting or backing down—is very hard to make. Both are costly—fighting in terms of lives and money, and backing down in terms of the loss of status, since it shows weakness, which leads to reduced support. When two competing entities each have the power to destroy the other, both must have extremely high trust that they won’t be unacceptably harmed or killed by the other. Managing the prisoner’s dilemma well, however, is extremely rare,” Dalio wrote.
Nevertheless, warnings like this aren’t new. Dalio has issued comparable cautions for years. This implies his latest remarks are a part of a constant long-term thesis quite than a sudden shift.
Nonetheless, it’s value noting that quite than making a direct prediction about navy battle, Dalio argues that the structural situations traditionally related to main energy transitions are actually in place.
Sponsored
Broader Implications for the Crypto Market
Dalio’s warning raises questions on how digital belongings would possibly carry out. In intervals marked by sanctions, asset freezes, and restrictions on cross-border finance, cryptocurrencies can entice consideration as various settlement rails that function exterior conventional banking infrastructure.
Bitcoin, particularly, is usually considered as proof against censorship and capital controls. These traits might develop into extra related if monetary fragmentation accelerates. On the identical time, cryptocurrencies stay delicate to world liquidity situations.
Traditionally, geopolitical stress and coverage tightening have triggered broad risk-off reactions throughout markets. This, in flip, might weigh on equities and high-beta belongings alike.
Sponsored
If rising tensions result in tighter monetary situations or decreased investor urge for food for danger, crypto markets might expertise heightened volatility within the brief time period.
“For stocks, this likely means higher volatility, lower valuations, and sharper swings as geopolitical risks rise. For crypto, weakening trust in traditional money could drive long-term interest, but short-term stress may still trigger severe price swings,” analyst Ted Pillows said.
One other key issue is that heightened geopolitical tensions might push traders towards conventional safe-haven belongings. Gold has traditionally benefited in periods of uncertainty, as capital seeks stability and long-standing shops of worth.
In latest months, treasured metals have surged to document highs, whereas cryptocurrencies struggled to recuperate following October’s tariff-driven market downturn. This divergence highlights that, regardless of Bitcoin’s “digital gold” narrative, many traders nonetheless deal with gold as the first hedge throughout acute geopolitical stress.
“As for investing, sell out of all debt and buy gold because wars are financed by borrowing and printing money, which devalues debt and money, and because there is a justifiable reluctance to accept credit.”
One, amongst many attention-grabbing items of this submit. https://t.co/XnwX42i4Hl
— Hunter Horsley (@HHorsley) February 15, 2026
If tensions deepen, capital flows might proceed favoring established defensive belongings over extra risky options. For crypto markets, that dynamic suggests a posh outlook: whereas long-term narratives round financial debasement and monetary fragmentation might strengthen, near-term worth motion might stay susceptible to shifts in world danger sentiment.
