Chinese yuan will become a top reserve currency sooner than expected, says Ray Dalio

The Chinese yuan will become a global reserve currency sooner than most people expect, said billionaire investor Ray Dalio.

The U.S. dollar is currently the world’s reserve currency, but billionaire hedge fund manager Dalio said the yuan’s role could grow much bigger in the next few years.

Dalio, founder of the world’s largest hedge fund Bridgewater Associates, said more global trade and financial transactions could be denominated in the yuan in the coming years. That’s going to help China’s currency become more widely used internationally, he told CNBC Managing Asia’s Christine Tan.

Here’s the investor’s take on why the yuan is going to become more attractive, and how its digital form could be a very viable investment alternative.