Goldman Sachs has predicted that the price of bitcoin could reach $100,000. The global investment bank believes that bitcoin will continue to take market share away from gold as cryptocurrency adoption grows.
Goldman Sachs Bitcoin vs Gold prediction
Goldman Sachs analyst Zach Pandl, co-head of global currency strategy, outlined the future prospects for bitcoin in a research note to clients on Tuesday.
The Goldman Sachs analyst expects that bitcoin will continue to take market share away from gold in 2022 as cryptocurrencies become more widely adopted. The research note details:
Bitcoin can have applications beyond a simple “store of value” – and digital asset markets are far more important than bitcoin.
The analyst noted that bitcoin’s float-adjusted market capitalization is currently under $700 billion. The cryptocurrency accounts for a 20% share of the “store of value” market, which comprises gold and bitcoin. This market is worth about $2.6 trillion, the note explains.
In its 2022 prediction list, Goldman Sachs said bitcoin would “very likely” grow to a larger proportion over time.
Pandl said that if bitcoin’s share of the store of value market were “hypothetically” to increase to 50% over the next five years, the price of BTC would increase to just over $100,000. The analyst added:
We believe that comparing its market cap to gold can help set parameters on plausible outcomes for bitcoin’s returns.
Furthermore, the Goldman Sachs analyst pointed out that even though the Bitcoin network’s consumption of resources may be an obstacle to institutional adoption, it will not stop the demand for the asset, the note said.
Goldman Sachs relaunched its cryptocurrency trading desk last year. In June, the company expanded its cryptocurrency offering to include ether futures and options.
