Goldman Sachs found or came up with some recommendations on why cryptocurrencies cannot be considered assets.
Bitcoin does "not generate cash flow like bonds." Because it's not a bond. And the sky is blue.
— Cameron Winklevoss (@winklevoss) May 27, 2020
It seems, that Goldman Sachs worries that cash flows in BTC pass by banks.
When critics of Bitcoin recall how much electricity miners spend on mining, they forget to say that there is now an overproduction of electricity in the world. You can, of course, either close unnecessary power plants and lay off workers, or let night-time lighting work around the clock, just to spend electricity. And you can mine BTC and give the energy sector income – let everyone choose for himself.
Today, the economy is in a very bad state, but the stock market keeps growing thanks to the pumping of Central Banks fiat. At the same time, gold is also growing, because not everyone believes that central banks will be able to drag, and the stock market will not fall again.
For some reason, they forget to add that on the same day both the stock market and gold fell down sharply. And for some reason, they don’t tell anything for the recent price of oil which is trading at $ 37 per barrel. Also, how would very high volatility?
We have to say that such events are an exception to the rule for traditional markets, and trading there usually goes in a much calmer course than on cryptocurrency exchanges.
There is a problem because the sphere of deals for BTC is still quite small and in most cases, we need to convert it to fiat. And the faster fiat becomes cheaper, the less you can buy for Bitcoin. To overtake this inflation, cryptocurrency must grow in price faster than dollars are depreciating, and so far we are fully coping with this task.
We also already have examples of how in Venezuela, Argentina, and Turkey. The demand for BTC increased sharply as a means of protection against inflation in the fall of national currencies in these countries. As for Bitcoin inflation itself, it is less than 2% per year after halving on May 11. Despite the fact that the global inflation rate is 3.5:
In just 15 days, the annual inflation of #bitcoin will go from 3.65% to just 1.8%… approximately half of the global annual inflation rate.
At this point, adoption doesn't even need to grow to sustain the price anymore. Satoshi either knew what he was doing or got really lucky. pic.twitter.com/ml1eXZFrO4
— Mati Greenspan (Tweets are not trading advice) (@MatiGreenspan) April 26, 2020
As for Goldman Sachs, is it strange that the organization does not advise its customers to get rid of dollars? The world’s leading banks are constantly featured in money laundering scandals, they pay billions of dollars in fines for this and continue to work, and Goldman Sachs is no exception.
Why are they just not closed for something like that? Maybe because all these fines are such a pullback. He made money on illegal transactions, sent a part of the amount to the treasury in the form of a fine, and continue to work on. At the same time, Bitcoin is a bad thing and banks and dollars are good ones.