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The rise in the price of bitcoin may continue to take away more and more market share from gold in the so-called “value storage market”, according to analysts at Goldman Sachs. They stated in a recent report that BTC could reach the $ 100,000 mark in the future.
As reported by Bloomberg for the first time, Goldman Sachs analysts have calculated that Bitcoin’s floating-adjusted market capitalization is just under $ 700 billion, accounting for 20% of the total “storage of value” market currently comprised of gold and BTC. In their analysis, they noted that the price of gold available for investment is around $ 2.6 trillion.
Hypothetically, analysts added, if bitcoin’s share of the value storage market rises to 50% over the next five years, each coin will trade at just over $ 100,000, which translates to a combined annualized return of 17% -18%.
The note adds that the consumption of energy resources by bitcoin may become an obstacle to its institutional adoption, but will not stop the demand for it completely. It is worth noting that BTC is often referred to as “digital gold” for its properties, although experts criticize it in the same way as gold: it brings neither interest nor dividends.
Goldman Sachs also noted that adding other uses to bitcoin besides storing value could help it grow further. Analysts wrote that while digital asset markets are much larger than BTC itself, they believe comparing its market capitalization to gold can help set the parameters for likely outcomes for its performance.
Goldman Sachs analysts last year predicted that the second-largest cryptocurrency by market capitalization, Ethereum, could reach the $ 8,000 mark by the end of 2021. Ethereum’s price failed to break the $ 4,700 mark last year amid a downturn in the cryptocurrency market and is now trading at $ 3,800, according to CryptoCompare.
In June 2021, the investment bank began trading bitcoin futures on behalf of clients through Galaxy Digital.
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