Billionaire investor and Bridgewater Associates founder Ray Dalio says Bitcoin still has substantial challenges to overcome before it can be viewed as a viable global reserve currency.

Dalio, who has previously acknowledged owning bitcoin BTC $87,165.80, offered more clarity on the size of his position, noting that the asset has represented roughly 1% of his portfolio for years. “I have a small percentage of bitcoin,” he told CNBC on Thursday. “I’ve had it forever, like 1% of my portfolio.”

Despite this long-standing allocation, Dalio argued that bitcoin remains structurally limited in its ability to serve as a reserve asset for sovereign nations. He pointed to traceability, transparency of transactions, and growing risks tied to advances in quantum computing as major obstacles.

“I think the problem with bitcoin is it’s not going to be a reserve currency for major countries because it can be tracked and, conceivably with quantum computing, controlled or hacked,” Dalio said, emphasizing that governments are unlikely to embrace financial systems that record all activity publicly and permanently.

Dalio has recently encouraged investors to consider allocating around 15% of their portfolios to bitcoin and gold—though he reiterated his preference for gold. “The advantage of gold is that it’s an asset you can hold, and you’re not dependent on someone to provide it,” he said.

Zooming out, Dalio warned that the U.S. economy is roughly 80% of the way into what he believes is a developing financial bubble, comparable to the conditions leading up to the 1929 crash and the 2000 dot-com collapse. His outlook is based on a proprietary bubble indicator that evaluates market risk using data dating back to 1900. The tool tracks metrics such as leverage, money supply expansion, and the concentration of wealth.

“The picture is pretty clear, in that we are in that territory of a bubble,” Dalio said.