Bitcoin is Not an Existential Threat to Gold, Says Goldman Sachs

As many popular personalities in the traditional space and crypto world say Bitcoin would take the place of gold as a hedging instrument, investment giant Goldman Sachs disagrees with this and claims both, Bitcoin and gold, can coexist.

The financial giant does not admit that gold would lose its value in front of the top digital despite an exponential growth on the part of Bitcoin this year.

Comparison between Gold and Bitcoin

Since the creation of Bitcoin from Satoshi Nakamoto, people started comparing it with gold because of some common features such as limited supply. However, the crypto supporters now believe that there is no correlation between both assets as the flagship currency has much potential that can also undermine the top hedge assets of the world.

Multinational investment company Goldman Sachs believes that Bitcoin is not going to replace gold but rather, both can exist together and can perform their functions as hedge assets. According to Goldman Sachs:

“Gold’s recent underperformance versus real rates and the dollar has left some investors concerned that Bitcoin is replacing gold as the inflation hedge of choice. While there is some substitution occurring, we do not see Bitcoin’s rising popularity as an existential threat to gold’s status as the currency of last resort.”

However, the multinational bank admitted that “some substitution” is happening which cannot be ignored. It also explained that some big investors will not invest in Bitcoin due to “transparency issues.”

JP Morgan, one of the largest banks in the United States, is holding a different opinion on both Bitcoin and gold. Analysts at JPMorgan Chase & Co claim the world’s leading digital asset has taken away a significant portion of gold’s market cap over recent months. They claim that the market witnesses a clear movement of wealth from gold ETFs to the flagship cryptocurrency.

The analysts explained that investors are now taking Bitcoin seriously and are thinking to move money out of gold and into the digital space. And if this trend continues, the price value of gold would decrease as a result. “If this medium to longer-term thesis proves right, the price of gold would suffer from a structural headwind over the coming years,” JPM’s analyst said.

The current market position of the BTC market is very bullish as the major digital coin is trading at $22,800.

Leave a Reply

Your email address will not be published.

Related

Coins Capital Review, Coins-Capital.com – Is Coins Capital Scam Or Legitimate?

Coins Capital Trading Platform Rating 4.3 Summary Read our Coins Capital review at FStar Capital Forex and Cryptocurrency Trading blog, find the answer to your question “is Coins Capital scam or legit” and much more! https://coins-capital.com/ Coins Capital Review You have been thinking for a long time if trading is for you. You have finally […]

AI Center Indicts ChatGPT Developer of Trade Law Violations: Claims Bias & Deception

The organization alleges that the creator of ChatGPT has violated Section 5 of the Federal Trade Commission Act with the release of GPT-4. This section of the act prohibits any practices or acts considered deceptive or unfair and that affect commerce. CAIDP has complained to the US Federal Trade Commission, intending to prevent the distribution […]

Investors Excited As XRP Market Capitalization Hits $20 Billion

It’s been wide jubilation today after XRP investors heard the announcement that the market capitalization has surged to $20 billion. XRP: a cryptocurrency developed and managed by Ripple, a San Francisco, United States, distributed data company. It was gathered that the coin itself responded to this development through a climb in price – it was […]

GlobalTrades Review, GlobalTrades.io – Is Global Trades Scam or a Good Broker?

GlobalTrades Trading Platform Rating 4.6 Summary Read our Global Trades review at FStar Capital Forex and Cryptocurrency Trading blog, find the answer to your question “is globaltrades.io scam or legit” and much more! https://globaltrades.io/ GlobalTrades Review As people look at cryptocurrencies and their immense success, they are eager to start their own trading businesses. While […]

Belgium Regulator Sets To Impose New Crypto Ads Rules

The Belgium government has mandated that every firm offering crypto advertisements should register with it before launching any campaign. Henceforth, any crypto advertisement without the government’s backing would be treated as an offense with heavy consequences. According to the report, the Financial Services and Markets Authority (FSMA) of Belgium recently announced that every potential crypto […]