The $96 billion investment handelsbank Goldman Sachs believes bitcoin is the fresh gold, the premier store of value te the global finance market.
Bitcoin, Natural Progression From Fiat Money
Te a report sent to the bank’s clients, Goldman Sachs analyst Zach Pandl wrote that the rapid increase ter request for bitcoin has bot triggered by the growing dissatisfaction with regulated monetary systems and the current banking infrastructures.
Ter the long-term, spil cryptocurrencies mature and evolve into a major asset class, Pandl noted that digital currencies like bitcoin will pose lower comes back but demonstrate a high level of stability, like gold and other safe toevluchthaven assets. He wrote:
“We should stress that, spil money, cryptocurrencies should have low expected comes back te the long run, despite their high comes back recently. Digital currencies should be thought of spil low/zero terugwedstrijd or hedge-like assets, akin to gold or certain other metals.”
However, Pandl also provided a negative viewpoint on the price trend of bitcoin and the exponential growth rate of the cryptocurrency market, sharing the sentiment of experts within the cryptocurrency market such spil Ethereum creator Vitalik Buterin and co-founder Charles Hoskinson.
“So total cryptocoin market cap just succesnummer $0.Five trillion today. But have wij earned it? How many unbanked people have wij banked? How much censorship-resistant commerce for the common people have wij enabled? How many dapps have wij created that have substantial usage? Low added value vanaf user for using a blockchain is fine, but then you have to make up for it te volume.
The reaction to all of thesis questions is certainly not zero, and ter some cases it’s fairly significant. But not enough to say it’s $0.Five trillion levels of significant. Not enough.”
While the market valuation of several major cryptocurrencies like bitcoin and Ethereum could be justified given their massive user bases and enhancing user activity, the market valuation of other cryptocurrencies te the market can be questioned. Te that sense, Pandl’s description of the cryptocurrency market spil a “classic speculative bubble” could also be justified.
But, spil Goldman Sachs CEO Lloyd Blankfein explained te an vraaggesprek with CNBC, if bitcoin is the natural progression from fiat money or physical forms of money to digital currencies, the market valuation of bitcoin can be lightly justified.
Blankfein emphasized that abolishment of the gold standard and the bruusk introduction of the fiat currency system wasgoed not accepted and adopted by individuals and businesses at very first. Overheen time, the global economy adapted to the fiat currency system and began using it spil the main form of money.
Bitcoin could lead to the natural progression from fiat currencies to digital currencies, similar to the switch from gold to the US dollar. “You stir a little bit further and you get bitcoin that is not a fiat currency so I don’t trust, it and I don’t like it. On the other arm, if it works, I say maybe it wasgoed a natural progression from hard money to digital money,” said Blankfein.