Ray Dalio warned the US stands “on a threshold” transition from Stage 5 pre-failure to Stage 6 systemic collapse ca Bitcoin it is trading defensively at $88,000, caught in a 60-day span by record institutional selling pressure from US counterparties.
The billionaire investor’s latest analysis of “Great Cycle” coincides with Bitcoin’s failure to rise to “digital gold” narrative, while traditional safe havens reach new highs.
Dalio’s framework identifies bankrupt government finances and wealth gaps as “the single most reliable indicator of civil war or revolution,” conditions, he argues, now characterize American reality.
Meanwhile, Wintermute’s office reports that Bitcoin remains stuck between them $85,000 and $94,000 as hemorrhaging capital US spot ETFs and Coinbase premium trades at a persistent discount, indicating that domestic institutions are leading a bearish push.
Dalio’s long essay positions current American conditions in stage 5 of his Big Cycle framework, where “poor financial conditions and intense conflict” precede systemic breakdown.
“We are now clearly on the verge of moving from Stage 5 (pre-failure) to Stage 6 (failure),” he wrote, pointing to unsustainable debts that force governments to “print a lot of money, which depreciates its value” or implement painful austerity.
The analysis comes as Bitcoin trades in consecutive 60-day ranges, an unusual pattern for an asset class often traded as a hedge against the currency devaluation described by Dalio.
Source: Wintermute
Gold climbed above $5,066 an ounce on Tuesday, while silver rose 6.4 percent to $110.60, both setting new records, as investors sought traditional hedges against inflation.
Dalio warned that “subsequent stages may involve capital controls, reserve freezes and cross-border restrictions, turning funds into political instruments,“conditions that usually favor”freely transferable assets“and investments”prioritizing frost and jam resistance.“
Bitcoin proponents have long argued that the crypto fits this profile, but the asset has failed to attract safe-haven flows amid high macro uncertainty.
Wintermute’s OTC desk has identified US selling pressure as the main force keeping Bitcoin suppressed in its trading range.
“Premium Coinbase confirms it. US counterparties are net sellers, more so than Europe (marginal buyers) or Asia (neutral),” states the company’s market update, noting that “ETFs are driving this market; when that offer goes away, you have choppy, directionless action.“
The U.S. spot Bitcoin ETF posted its biggest weekly outflow since February 2025 last week, reversing the strong flows that accompanied January’s brief escape attempt toward $97,000.
The failure of that rally left Bitcoin back in the middle of its established range, with $85,000 serving as tested support.
CryptoQuant’s on-chain analysis suggests selling pressure is also coming from opportunistic profit-taking rather than forced capitulation.
Source: CryptoQuant
The Miner Position Index is printed close to -1.5, indicating miners “they are now selling less than their one-year average” after aggressively monetizing inventory at $110,000-$120,000 levels.
Similarly, whaling reports remain high, but deposits fall”well below previous highs, implying a tactical, price-sensitive distribution rather than an all-out capitulation.“
Source: CryptoQuant
Speaking to Cryptonews, Arthur Azizov, founder at B2 Ventures, framed Bitcoin’s weakness in the context of competing safe-haven narratives.
“When uncertainty rises, capital first moves into classic defensive assets. We are seeing this now since gold broke above $5,000,“, said Azizov, adding that “Bitcoin is often called “digital gold”, but in reality it is still primarily a risk asset.“
Several macro catalysts are converging this week that could finally break Bitcoin out of its compressed range.
The Federal Reserve announces its policy decision on Wednesday, alongside key earnings from Microsoft, Meta, Tesla and Apple, while Trump’s fresh 25% tariff threat against South Korea adds to geopolitical uncertainty.
Wintermute analysts expect continued consolidation in the absence of a clear directional catalyst.
“Sixty days of compression experiencing so much event risk, something gives,“, the firm concluded, identifying $85,000 as a critical level of support with the ETF flow reversal needed before Bitcoin can”break convincingly above the mid-$90,000 levels.“
Bitcoin traded at $88,553 today and rose 1.4% as Asian markets opened with tentative optimism despite fresh tariff threats.
Source: TradingView
However, at the time of writing, Bitcoin is back below the $88,000 support level, pushing the total crypto market cap to $3.06 trillion, down 0.18% on the day.
The uncertain trajectory came as broader risk assets were ahead of the Fed’s decision, although “the base case is consolidation”, with expectations that Bitcoin will “maintain the $85,000 – $88,000 area”, which previously served as strong support until the end of 2025.
Read original story Dalio: US Approaches Crisis Point as Bitcoin Caught in US Selling Pressure By Anas Hassan at Cryptonews.com
