US investment giant Goldman Sachs expects cryptocurrency prices to continue to fall. The same can be seen in an updated version of the company’s annual outlook, which was released on August third. This confirms Goldman Sachs their bearish positioning to Bitcoin & Co. in January of this year .
The descent of the Bitcoin price since its all-time high last December is expected to continue. Goldman Sachs comes to this conclusion in the update to their “(Un) Steady as She Goes” baptized year outlook from the beginning of this year.
In this, Goldman Sachs noted a “cryptocurrency delusion”, one of the six biggest uncertainties in terms of global economic development. Bitcoin & Co. was honored to be named in a row with terrorism and growing geopolitical tensions. As for the course of crypto currencies, Goldman Sachs was skeptical in January’s report:
“We do not believe that these cryptocurrencies will retain their value in the long run.”
Now, half a year and over 60 percent BTC price loss later, Goldman Sachs see their forecast confirmed.
“Our assessment that cryptocurrencies will not be able to sustain their value will persist and, in fact, has proven to be correct earlier than originally assumed”,
it says in the half-yearly report . Furthermore, one expects further price falls. Goldman Sachs justifies the bearish forecast with the well-known argument that Bitcoin & Co. could not act as currency:
“We expect further price declines in the future, as we believe cryptocurrencies do not fulfill any of the three functions of traditional currency: they are neither a means of exchange nor a counter nor a store of value.”
However, the report emphasizes that falling crypto rates would have no negative impact on the financial market. The total market capitalization of all crypto commodities represents only 0.3 percent of global gross domestic product. The media attention they received was therefore disproportionate.
“In fact, we believe that they attract far more attention in traditional media and social media than is justifiable.”
Nevertheless, Goldman Sachs does not seem to completely shut down the cryptocurrencies. In May, the company announced plans to set up a trading desk to trade cryptocurrencies. In addition, you get with the trader Justin Schmidt crypto expertise in the company. The new CEO David Salomon is also hoping for a lot.
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Categories: Crypto Currency