Alternative Investments/Digital: Goldman Survey Shows Investors Are Bullish On Cryptos
Goldman Sachs operates a digital asset business within its markets division.
The Block, which had access to the results of a survey of 280 Goldman Sachs (NYSE: GS) clients on the subject of digital asset investing, reported that investors are bullish on the prospects of cryptocurrencies.
Goldman Sachs’ Max Milton revealed to The Block that 40% of the respondents had exposure to cryptos. Of these, more than 60% expect to increase their holdings over the next couple of years.
On the recent rally in bitcoin, 28% of respondents felt that the macroeconomic factors were the most important reason for rising prices. However, 57% thought that bullish news such as institutional interest was the cause.
Slightly more than half of the respondents predict the price of bitcoin to lie between $40,000 and $100,000 in 12 months.
Only a fifth (22%) think the price will exceed $100K in that period.
What are the biggest hurdles to investing in digital assets?
24% considered the non-availability of a well-regulated and investible asset as the greatest hurdle; however, 34% felt internal mandates/permissions, as well as regulation, were the main stumbling block.
Goldman Sachs said last month that bitcoin’s price volatility shows that it is not a store of value. “Something with a long-term volatility of 80% can’t be considered a medium of exchange,” Sharmin Mossavar-Rahmani, head of consumer and investment management at Goldman Sachs, said in remarks at a recent conference reported by Bloomberg. “Just because everybody piles into an idea and talks it up doesn’t mean it’s a store of value.”
However, in a separate note, Goldman Sachs analysts said bitcoin and gold should not be viewed as mutually exclusive investments, and that both could co-exist.
“In an environment of broadband dollar weakness and still very low and negative real rates we do not see either asset cannibalizing each other and see enough room for both,” the analysts said.
In what is viewed as a bullish sign for crypto, Reuters reported Monday that the Wall Street giant had restarted its cryptocurrency trading desk and would begin dealing bitcoin futures and non-deliverable forwards for clients from the coming week.
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