According to analysts at investment bank Goldman Sachs, investing in cryptocurrencies is not a “viable” investment, but cryptoassets can be used to speculate in the market.
Goldman Sachs analysts said that despite the growing interest of people in cryptocurrencies, investing in them is still risky. Some investors refer to bitcoin as “digital gold”, but in fact, this does not give it any value. Researchers believe that gold itself is not an optimal store of value compared to US equities, which can better protect funds from inflation.
Goldman Sachs said that strong fluctuations in the cryptocurrency market scare potential buyers of digital assets. The information published in the media and the statements of famous personalities on the social network Twitter affect the course of the main cryptocurrencies. In addition, the opposing views of digital assets in the industry confuse many Goldman Sachs customers interested in purchasing.
Therefore, the bank came to the conclusion that bitcoin cannot become a long-term store of value, and it cannot be considered a separate asset class for diversifying its investment portfolio. At the same time, the bank’s analysts believe that cryptocurrencies can be “ideal for market speculation.”
Separately, the bank highlighted the risks related to investments in crypto assets. We are talking about regulatory risks associated with a possible ban on cryptocurrency trading by regulators, environmental problems arising from Bitcoin mining, as well as hacker attacks, during which users can lose their funds.
“Based on all these risks, the characteristics of Bitcoin’s profitability and the fact that it does not meet any of the criteria to become an independent asset class, we do not recommend investing in cryptocurrencies,” analysts said.
However, Goldman Sachs is not opposed or shunned by cryptocurrencies. The bank announced this week that it plans to launch Ethereum futures and options trading. This suggests that some of the bank’s clients are really interested in becoming participants in the cryptocurrency market.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
