Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Goldman Says Bitcoin $100,000 a Possibility by Taking on Gold

Published 2022-01-05, 07:14 a/m
Updated 2022-01-05, 07:14 a/m
© Reuters.

© Reuters.

(Bloomberg) -- Bitcoin will continue to take market share from gold as part of broader adoption of digital assets, making the often touted price prediction of a $100,000 by advocates a possibility, according to Goldman Sachs Group (NYSE:GS).

Goldman estimates that Bitcoin’s float-adjusted market capitalization is just under $700 billion. That accounts for 20% share of the “store of value” market which it said is comprised of Bitcoin and gold. The value of gold that’s available for investment is estimated at $2.6 trillion.

If Bitcoin’s share of the store of value market were “hypothetically” to rise to 50% over the next five years, its price would increase to just over $100,000, for a compound annualized return of 17% or 18%, Zach Pandl, co-head of global FX and EM strategy, wrote in a note Tuesday.     

Bitcoin traded around $46,000 on Tuesday in New York, after climbing about 60% last year. The largest digital asset by market value hit a record of almost $69,000 in November. It has surged more than 4,700% since 2016.

Although the Bitcoin network’s consumption of real resources may be an obstacle to institutional adoption, that won’t stop the demand for the asset, the note said. 

Bitcoin has long been referred to as digital gold. And the criticisms levied at gold tend to apply to Bitcoin as well: It pays no interest or dividends, and it doesn’t imitate the performance of more traditional assets. Advocates say Bitcoin, like gold, serves as protection against the systemic abuse of fiat currencies.

 

Latest comments

An interestingly well-timed article as Gold is soaring. Think and DYOD
I don't think wise investors are falling for the BTC is better than Gold trick anymore! Sorry
Each time Goldman/JPM have reported that BTC is going to 100K it crashes...
Nobody should be falling for this ruse
Desperation is setting in...dupe investors into another form of fiat and not into Real Assets like Gold. China will soon introduce its own Crypto backed by GOLD
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.