Goldman Sachs’ head of energy research says, “Just like we argue that silver is a poor man’s gold, gold is maybe becoming the poor man’s crypto.” He sees funds starting to flow from gold into bitcoin as inflation fears escalate, noting that “We’ve argued historically that crypto and gold do not have to cannibalize each other.”
Goldman Sachs: Bitcoin and Gold
Interview with Bloomberg by Damian Courvalin: Head of Energy Research at Goldman Sachs.
If he could find any evidence to suggest that other investments, such as bitcoin or cryptocurrencies are being used by investors to offset inflation, it was his answer. “I think it’s actually starting,” he replied, adding: “We’ve argued historically that crypto and gold do not have to cannibalize each other.”
Admitting that “it’s a fact, we have seen substitution recently,” he detailed:
Just like we argue that silver is a poor man’s gold, gold is maybe becoming the poor man’s crypto.
Courvalin continued: “At this point, there may be enough wealth to allocate to both, especially, I think, as that inflation signal is starting to be more pressing.”
The executive noted: “The value of crypto is its network, just like the value of oil is the fact that it’s consumed. Gold, like diamonds and art, doesn’t have that. It’s just a pure defensive asset that can outperform over a significant period of time.”
Goldman Energy Research head, also noted that after China outlawed cryptocurrency, investors shifted to gold.
Inflation fears have led many people to switch from gold and bitcoin. In October, billionaire hedge fund manager Paul Tudor Jones said, “Clearly, there’s a place for crypto. Clearly, it’s winning the race against gold at the moment … It would be my preferred one over gold at the moment.” He emphasized that “crypto is here to stay.”
In the same month, JPMorgan said, “Institutional investors appear to be returning to bitcoin perhaps seeing it as a better inflation hedge than gold.” The firm also doubled down on its long-term bitcoin price prediction of $146K for bitcoin as an alternative to gold.
Some people prefer bitcoin and gold. Robert Kiyosaki is an author and Rich Dad Poor Dad. He has been advocating both bitcoins and gold. He predicted a market crash that would be followed by new depression. He recommended, “Be smart: Buy, gold, silver, bitcoin.”
What do you think about the comments by Goldman Sachs’ executive? Please leave your comments below.
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