Goldman Sachs seems bullish on bitcoin, after an analyst from the bank said the digital currency will take market share away from gold this year as digital assets become more widely adopted
Citing bitcoin's $700 billion market capitalization, compared to the around $2.6 trillion worth of gold owned as an investment, Goldman Sachs said that the cryptocurrency currently has a 20% share of the "store of value" market.
Bitcoin will "most likely" become a bigger proportion over time, Goldman Sachs said, in a list of 2022 predictions.In a hypothetical scenario in which bitcoin grabs a 50% share of this market, its price would reach just over $100,000, the note said.A representation of the virtual cryptocurrency Bitcoin is seen in this picture illustration taken October 19, 2021.
"Bitcoin may have applications beyond simply a "store of value" - and digital asset markets are much bigger than Bitcoin - but we think that comparing its market capitalization to gold can help put parameters on plausible outcomes for Bitcoin returns," Pandl wrote. The term "store of value" usually describes assets which can maintain their worth over time without depreciating, such as precious metals or some currencies.Register now for FREE unlimited access to Reuters.comMore from ReutersSubscribe for our daily curated newsletter to receive the latest exclusive Reuters coverage delivered to your inbox.