Goldman Sachs: Bitcoin Has Generated More Media Attention Than Is Warranted


Despite grabbing headlines for their plans to launch a Bitcoin trading desk this year, Goldman Sachs clearly still has reservations about digital currencies. The multinational investment bank believes that lower prices are on the horizon.

Has Bitcoin Received More Media Attention Than It Warrants?

Goldman Sachs’ investment strategy group has stated that the price of Bitcoin is set for further declines.

They expressed such sentiments in their midyear economic-outlook report. The document assesses the concerns raised in their start-of-year report titled (Un)Steady as She Goes.

According to a report in Business Insider, the investment strategy group’s leader, Sharmin Mossavar-Rahmani stated:

“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.”

The chief investment officer at the multinational investment bank went on to claim that cryptocurrency does yet fully serve vital roles associated with a currency. These are: medium of exchange, unit of account, or a store of value.

Mossavar-Rahmani continued, stating that the digital asset class is not sufficiently developed to impact upon wider financial markets. His reasoning is that the entire market capitalisation of digital assets are just 0.3% of the world GDP. The investment officer also claimed that cryptocurrencies had perhaps received much more coverage than they should have:

“In fact, we believe that they garner far more traditional media and social media attention than is warranted.”

The report from Goldman Sachs may come as a surprise to those who follow the space closely.

Back in December 2017, NewsBTC reported on the investment bank’s plans to launch an over-the-counter (OTC) trading desk for institutional investors to get exposure to popular cryptocurrencies. Our report stated that the bank was aiming to have their product online by June of this year. However, such a trading desk has yet to be launched.

Bitcoin comprised of just a few paragraphs in the 42-page report addressed to Goldman Sachs’ clients that was published today. Much of the document focused on other factors impacting investment markets. These include: global economic growth, probability of a U.S. recession, inflation rates, equity markets, U.S. domestic politics, and increased geopolitical tensions.

New York Times journalist and author of Digital Gold: Bitcoin and the Inside Story of the Misfits, Nathaniel Popper, responded to the report and accusations of hypocrisy from the cryptocurrency community via Twitter.

He was quick to remind his followers that huge institutions such as Goldman Sachs rarely (if ever) operate as a single entity. Rather, they are comprised of different departments that are capable of forming “different hypotheses about the markets they operate in.”

This — and the different approaches being followed by other parts of Goldman — is a great reminder of the way that different parts of the company form different hypotheses about the markets they operate in. It’s not a monolithic entity with one opinion. https://t.co/5rbRUp6gNs

— Nathaniel Popper (@nathanielpopper) August 3, 2018

Featured image from Shutterstock.

The post Goldman Sachs: Bitcoin Has Generated More Media Attention Than Is Warranted appeared first on NewsBTC.

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