Skip to main content

Goldman Sachs Considers Bitcoin as Money

Bitcoin as Money, a proprietary research paper published internally by Goldman Sachs, argues, “Our working assumption is that long-run cryptocurrency returns should be equal to (or slightly below) growth in global real output—a number in the low single digits.” Eventually, “digital currencies should be thought of as low/zero return or hedge-like assets, akin to gold or certain other metals,” they claim. As a money in the way most people understand it, Goldman is open to the idea “in theory.”
Goldman Sachs Recognizes Bitcoin's Future Potential
Zach Pandl
The US legacy bank of banks, Goldman Sachs has been around 150 years. It existed decades before the Federal Reserve, and it has withstood many financial fads. Goldman employees go on to run the world, occupying the highest offices in governments. When it speaks on a subject, markets listen.
Goldman researchers Zach Pandl and Charles Himmelberg explain how their findings reveal in “recent decades the US dollar has served its purpose relatively well,” however, “in those countries and corners of the financial system where the traditional services of money are inadequately supplied, Bitcoin (and cryptocurrencies more generally) may offer viable alternatives.” Use cases aplenty can be found, from Zimbabwe to Venezuela.
“The widespread use of the dollar,” they continue, “outside the US — and full dollarization in some countries — suggests there is already demand for an internationally accepted medium of exchange and store of value.” Bitcoin ripeness.
Goldman Sachs Recognizes Bitcoin's Future Potential

Heavy Yoke of Government Money

Missing from their analysis is the yoke, heavy and planetary in reach, of the US greenback as the world’s reserve currency and store of value. It’s key to understanding the entire cypherpunk reasoning behind cryptographic money. With the US dollar comes the Fed system. That apparatus in turn is propped up by the US Treasury, which itself is kept insulated from monetary competition by the US military and judicial structures.
Goldman Sachs Recognizes Bitcoin's Future Potential
Charles Himmelberg
Treaties and global realism make fiat currency appear much more “stable” and “valuable” than it might be otherwise without institutions of coercion. Goldman’s authors consider exactly none of this. The two researchers actually predict bitcoin’s acceptance by Goldman and other institutions mean laws and regulations are coming. This will spur adoption, they believe. Bitcoin, they argue, needs to compete ultimately with the dollar’s transactional low cost.
It’s easy to wax about three decades of US currency hegemony, as the authors do, when ignoring reality. Low inflation and trade-weighted exchange rate stability, which buttress their argument bitcoin/crypto is no match for fiat beyond emerging economies, are maybe less desirable relative to the actual costs – if only they were stated side-by-side. Indeed, a supermajority of foreign exchange reserves are in US dollars, and one third of all exchanges settle in its dead presidents. Crypto has a long way to go.   
The authors do acknowledge bitcoin’s potential to serve unbanked populations. In countries like India and China where widespread dissatisfaction with domestic currencies is growing, so will bitcoin, they write. At present the authors view bitcoin as being “more consistent with a classic speculative bubble.” That fact doesn’t seem to be stopping their employer from setting up its own crypto trading desk, however.

Comments

Popular posts from this blog

MYSTERY OF BERMUDA TRIANGLE FINALLY SOLVED

MYSTERY OF BERMUDA TRIANGLE FINALLY SOLVED   17 COMMENTS    23472 VIEWS Bermuda Triangle Mystery Solved? Scientists believe they’ve solved the mystery of the Bermuda Triangle ― and it’s not UFOs or sea monsters. It’s another kind of monster: monster waves. The Bermuda Triangle, also known as the Devil’s Triangle, is a region in the North Atlantic that is generally bounded by Miami, Bermuda and Puerto Rico. Over time, a number of aircraft and ships are said to have disappeared there under mysterious circumstances. According to “The Bermuda Triangle Enigma” on Britain’s Channel 5, scientists now believe conditions in that area were just right for massive rogue waves. “There are storms to the south and north, which come together,” said University of Southampton oceanographer Simon Boxall, per the Sun. “And if there are additional ones from Florida, it can be a potentially deadly formation of rogue waves.” Boxall said these rogue waves could reach 100 fee...

EZeugo Is the Right Candidate For Idemili North Constituency.

A sound mind is a healthy body, unfortunately most of our people suffer from various diseases as a result of their life style,water the drink, type of food the eat (poor dieting) and drugs abuse which in return leads to many complications in the later stages of their lives. Majority of our people over the age of fourty  suffer from specific health problems E.g heart diseases, advanced diabetes, blood pressure (BP). In my view the issue of health is not limited to health services, health is a specific culture that can be attened by harmonizing body and mind. To reach this health conditions, in addition to a good healthy services, base on my background in Health and Environmental Safety (HES) I Ezeugo have a good health investment programs that will help improve following area - health education, Custom and traditions, food and environmental hygiene, sports, provisions of safe drinking water, public awareness in various aspects of life. Ezeugo have all it take to make Idemili...

The Satoshi Revolution – Chapter 5: ICOs

The Satoshi Revolution: A Revolution of Rising Expectations. Section 2 : The Moral Imperative of Privacy Chapter 5: Implementing Crypto Privacy by Wendy McElroy ICOs: Peril or Menace or Expression of Satoshi Spirit? (Chapter 5, Part 2) It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way… – Charles Dickens, A Tale of Two Cities Crypto advocates differ dramatically on the impact of Initial Coin Offerings (ICOs). They are a valuable dynamic that financed Ethereum’s smart contract; they are a blank cheque for scammers; they give government a wedge with which to separate cryptocurrency from freedom. The damnable thing is that all the assessments may...