Bitcoin’s price might reach £73,000, according to Goldman Sachs. As cryptocurrency use becomes mainstream, the global investment bank expects bitcoin will continue to eat into gold’s market share.
In a research note to clients on Tuesday, Goldman Sachs analyst Zach Pandl, co-head of global foreign currency strategy, highlighted the future outlook for bitcoin.
The Goldman Sachs analyst believes that gold will lose its market share to bitcoin in 2022 as cryptocurrency adoption continues to expand. The research note explains:
Bitcoin may have applications beyond simply a ‘store of value’ — and digital asset markets are much bigger than bitcoin.
The leading cryptocurrency’s float-adjusted market capitalisation is currently around £515 billion, according to the analyst. The cryptocurrency has attained a 20% share of the “store of value” market. According to the note, this market is worth £1.9 trillion.
Goldman Sachs’ 2022 estimates predict bitcoin will “most likely” snag a larger share.
According to Pandl, for bitcoin’s share in the store of value market to “hypothetically” swell to 50% in the next five years, its price would hit £73,000. The expert went on to say:
We think that comparing its market capitalisation to gold can help put parameters on plausible outcomes for bitcoin returns.
The Goldman Sachs analyst noted that, while the Bitcoin network’s energy consumption may be a barrier to institutional adoption, it would not deter demand for the cryptocurrency, according to the note.
Last year, Goldman Sachs reopened its cryptocurrency trading department. The firm added ether futures and options to its cryptocurrency offerings in June.
Bitcoin is currently trading at £ 52,591.71, down -0.49% in the last 24 hours. The drop in the world’s top cryptocurrency was accompanied by a steep drop in tech stocks.
The year has so far brought bitcoin a 6.6% fall.
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