According to major investment bank Goldman Sachs, Bitcoin can reach the coveted valuation of $100k if it can keep eating away at Gold’s share. The bank’s regulators made this prediction in a recent note released to their investors.
Bitcoin had a largely bullish 2021 that saw it almost double by the end of the calendar year. Gold on the other hand had a year to forget as it actually shed 5% of its value by the end of 2021 and mostly trended downwards throughout this time. But, the end of 2021 was a somewhat bad one for Bitcoin and caused an anti-climax situation. Now, the bulls are predicting a price appreciation for Bitcoin again. Here is the official scorecard from the Goldman Sachs:
Well, off all people Goldman Sachs’ executives believe that it could, theoretically reach there. It just needs to chip away at Gold’s share in the store of value market. Its report states that the top digital currency needs to occupy at least 50% of the store of value market and then the price could easily shoot upwards of $100k. But, for that to happen, Bitcoin needs to continue eating away into Gold’s share and not look back. While the bank’s report is for the next five years and a lot could change during that time including a steep rise in Gold’s own value, for Bitcoin it is relevant right now as it is looking at a new bull run to achieve that feat.
According to the bank, Bitcoin is worth around $700 billion when float adjusted while Gold itself is around $2.5 trillion worth of investment. The overall store of value market is dominated by Gold currently but that could begin to change in the near future. If Bitcoin can reach as much as 50% of the valuation, that brings the price index to just above $100k, which is the main target for the bulls even now.
Goldman Sachs also touched on various other facets of the crypto sector and claimed that the debate around the energy intensive mining nature of the digital currency will have no long-term effect on the price index. This proved to be true as in 2021, the issue was blown out of proportion and yet, Bitcoin persevered at the end and managed to post a new all time high of $69k.
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