Billionaire venture capitalist Chamath Palihapitiya believes that a long-term decline of the US dollar is not an existential concern for America.

In a new episode of the All-In podcast, host Jason Calacanis highlights that the US dollar index (DXY) witnessed its worst first-half performance in over 50 years after losing nearly 11% of its value against other major currencies in the first six months of 2025.

While Calacanis describes the slump as “shocking,” Palihapitiya argues that the dollar has been in decline for decades, and it’s not a major concern because the gains from US assets have consistently outweighed the currency’s depreciation.

“This has been a one-way trade for a very long time, and it’s probably important to understand why that is. And I think it generally has to do with the fact that the United States finances a lot of growth, and that has been the right decision. 

Unless you see a complete collapse in the currency, I suspect that this decay continues to happen. So the question is, is it a bad thing? And the answer is it depends. 

Because if asset prices increase faster than the dollar devalues, you’re still ahead… If you look at asset prices in the United States relative to asset prices any place else in the world, it is the flight to quality, which is to say it is the thing that everybody wants to own. And you see that in the equity markets, you see it in real estate, you see it in hard assets…

The reality is that a lot of people still want to own these assets more than they want to own other assets and those assets are dollar-denominated.”

Palihipatiya also highlights that there will be a constant demand for dollar-denominated assets as long as “there’s American ingenuity and American supremacy,” which would meaningfully offset the downside of holding USD.

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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Billionaire venture capitalist Chamath Palihapitiya says staying bullish on the markets will pay off, pointing to two key financial factors driving his conviction.

In a new episode of the All-In Podcast, Palihapitiya takes a close look at the M2 money supply chart, which has been on the up and up.

The billionaire notes that M2 growth is one of the key reasons why the S&P 500 is in the midst of a strong uptrend.

“If I was a betting man… I think the free money trade here is to be levered long. I think you can make a lot of money right now. Why is that? The first chart I want to show you is the velocity of money… This is the M2 money supply. It’s a measure of how much money is circulating in the economy. 

What this shows is the impact of rates, where we were able to start to slow down and contract the money supply. But then as the economy stabilized and people started to project what was possible in 18 to 24 months, you started to see money coming back into the system. That’s what has given a bid to the equity markets.”

The billionaire is also keeping a close watch on the amount of money invested in money market funds, which are financial instruments that provide yields that are largely influenced by the prevailing interest rates set by the Federal Reserve.

Palihapitiya says that once the Fed starts cutting rates, trillions of dollars in capital stashed in money market funds will likely be invested in the stock market.

“Look at how much money is sitting in money market funds, and what this starts to show you is you have trillions of trillions of dollars of dry powder in the sidelines that will need to find a home. 

I think that [Fed chair] Jerome Powell is in an increasingly [untenable] situation because he will be looked at as politicizing the office of the Federal Reserve. There is enough data that can justify cutting rates. If you cut rates, two things will happen. 

Number one is people will take some amount of money out of the money market funds because they will want to go and seek superior returns somewhere else. It will increase the velocity of money at the same time. You put those two things together that is a bid to the equity markets.

And so if we’re at an all-time high today with rates at 4.5% and Powell’s back is against the wall to cut, the only road from here is probably up…

I think if Powell starts an aggressive cutting program… you could see the S&P 500 at 7,000.” 

As of Monday’s close, the S&P 500 is trading at record-high levels of 6,204.

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Billionaire Chamath Palihapitiya is predicting a resurgence of the American balance sheet and an influx of new capital into the US.

In a new episode of the All-In podcast, Palihapitiya says current forecasts of the US economy are overly negative and don’t factor in the potential development of two events.

According to Palihapitiya, President Trump’s tariffs are likely on track to contribute an extra $300 billion in receipts to the US government’s current account in what he says is a big positive for the economy.

The investor says that when factoring in the likelihood of at least 100 basis points in Fed rate cuts, the US is on track to save $300 billion as well – meaning a total of $600 billion in revenue boosts to the United States, providing a big jump to overall confidence in the American economy and markets.

“We all thought that this was like a bogeyman that you weren’t allowed to touch it, and if you touched the stove, you’re going to get burned. The mathematical reality is that this is actually going to work out much better for us than we anticipated, and it’s going to be somewhere in the range of $300 to $400 billion of extra revenue per year. That’s a huge win. 

So why is that important? That then sets up this next cataclysmic thing that we’re going to see in the next 60 days, which is, what does Jerome Powell do? If Jerome Powell stays politicized, his incentive will be to keep interest rates where they are.

If Jerome Powell looks at the conditions on the ground, especially when you start seeing inflation stay in the low 2s, and approach 2.0, the real thing that he’s going to be under tremendous pressure to justify is ‘Why are you not cutting?’

And just to give you a sense of how important that is, if we cut by a hundred basis points, that’s another $300 billion. In that case, that’s not money we get in, but it’s money we don’t have to spend.

So if you add these two things together, we are in the next 60 days, going to have to reforecast the American balance sheet where this is, or we’re actually going to be able to positively forecast an extra $600 billion – $300 billion of incremental revenue and $300 billion of savings. 

If that happens, watch out. It means that every single risked dollar is going to run to America. Every single one. Forget Japan, forget Europe, there is no place to put your money except the United States.”

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