Goldman Sachs Expects Further Decline of Bitcoin
August 8, 2018
On August 3, the American investment bank Goldman Sachs published a report, where the cryptocurrency mania was identified as one of the six reasons for the current instability of financial markets.
Goldman Sachs' chief investment officer Sharmin Mossavar-Rahmani said in the report:
"We expect further declines in the future given our view that these cryptocurrencies do not fulfill any of the three traditional roles of a currency."
The bank referred to its January report, where it said that the rise of Bitcoin to $20,000 was mostly caused by the overall mania, similar to the one happened during the dot-com bubble.
"Our view that cryptocurrencies would not retain value in their current incarnation remains intact and, in fact, has been borne out much sooner than we expected."
She also told that the total value of the cryptocurrency market is still insignificantly small compared to all other financial markets:
"Such declines will not negatively impact the performance of financial assets because cryptocurrencies represent just 0.3 percent of world GDP as of mid-2018. In fact, we believe that they garner far more traditional media and social media attention than is warranted."
In December 2017 the bank announced the launch of its own cryptocurrency derivatives trading platform. The platform is due to launch in 2018. Also, the head of the bank Lloyd Blankfein said that cryptocurrencies definitely have a future.
It should also be noted, that last week another large bank UBS published a report, where it called Bitcoin an extremely volatile currency that is unfit to become widely popular.