Goldman Sachs Commodity Research Head – Bitcoin is Transforming into a Mature Asset
Jeff Currie, global chief of commodities research at Goldman Sachs, acknowledged that Bitcoin’s exceptional rally has lured institutions in a big way, but pointed out that smart-money still makes up only a small percentage of the overall market.
A huge number of such investors should enter Bitcoin so that it transforms into a stable asset and flash crash seen earlier this week does not happen.
Regarding Bitcoin, Currie said “I think the market is beginning to become more mature.” He further opined that “volatility and those risks that are associated with it” are not unusual for emerging assets.
Regarding stability, Currie said:
“The key to creating some type of stability in the market is to see an increase in the participation of institutional investors and right now they’re small […] roughly 1% of it is institutional money.”
In the last one year, many prominent analysts and Wall Street traders have given their support to Bitcoin. In fact, big stock market investors such as Stanley Druckenmiller and Paul Tudor Jones have invested in cryptos. Also investment funds such as MassMutual and Ruffer Investment Company have bought considerable quantities of Bitcoin.
In December, SkyBridge Capital, the hedge fund headed by Anthony Scaramucci, gave an application to the US SEC for opening a new Bitcoin fund. This is in addition to the billions that have been invested by Grayscale, MicroStrategy, Square and PayPal put together.
Even Goldman Sachs has altered its stance on Bitcoin and cryptocurrencies. The investment behemoth has strengthened its organization, with respect to blockchain and cryptos, by hiring digital currency professionals. Furthermore, it has also started advocating co-existence of gold and Bitcoin as hedge against uncertainty.
The US-based Coinbase, one of the largest crypto exchange by trading volume, has also roped in Goldman for its upcoming IPO (initial public offer).
Following a decade of extreme price volatility, Bitcoin (BTC) is slowly transforming into a mature asset, as per Jeffrey Currie.