Crypto fanatic, writer and researcher. Thinks that Blockchain is second to a digital camera on the list of greatest inventions.
McDermott noted that clients and other entities are largely treating the digital currency as a new asset class which is notable as we don’t get to witness the emergence of a new asset class every day.
According to Goldman Sachs, Bitcoin has what it takes to be a new asset class and should be treated as such. The biggest digital coin has come a long way from being tagged as a thing associated with crime to one of the hottest commodities on the crypto scene. Bitcoin’s acceptance has grown each year and even more so this year as many traditional financial institutions adopted it as an investment option for clients to diversify their investment portfolio.
Bitcoin, in the eyes of many, has been considered an asset for years but hasn’t received the public recognition, backing, or adoption to thrive under such a tag. Goldman Sachs now thinks it’s time to take Bitcoin way more seriously as an investable asset and not just a cryptocurrency. Mathew McDermott, Goldman Sachs’ global head of digital assets, in a new piece of research stated that “Bitcoin is now considered an investable asset. It has its own idiosyncratic risk, partly because it’s still relatively new and going through an adoption phase.”
McDermott added that “Bitcoin doesn’t behave as one would intuitively expect relative to other assets given the analogy to digital gold; to date, it’s tended to be more aligned with risk-on assets.” McDermott however noted that clients and other entities are largely treating the digital currency as a new asset class which is notable as we don’t get to witness the emergence of a new asset class every day.
Bitcoin’s price has been battling one of the biggest market volatility as its price plunged last week and is currently under pressure. The biggest cryptocurrency as press time was trading at $37,396, down 17.43% in the last seven days. Goldman’s latest comment on Bitcoin, according to some industry players, is a glowing endorsement that can somewhat give Bitcoin the spark to get over its current hurdle. Other market experts have stated that Bitcoin has something in common with a typical stock as they both react wildly in the face of the volatility after the tiniest bit of news.
The latest comments from Goldman Sachs have also raised a few eyebrows as the multinational investment bank and financial services company recently published a report tipping Ethereum to rise and become the crypto of choice in the crypto space. The report however stated that Bitcoin is now viewed as a digital store of value, comparable to gold, housing, or fine wine, but also described Ethereum as a project with the potential to overtake Bitcoin as the top crypto “it’s relatively diverse capabilities for various applications that could lead it to become the Amazon of trusted information”.