The world’s most valuable cryptocurrency has fallen to roughly $46,000 after surging to a record high near $69,000 in November. however, Goldman Sachs said in a report this week that bitcoin could more than double to just over $100,000 per coin in the next five years.
“We believe bitcoin’s market share will likely increase over time as a byproduct of the broader adoption of digital assets,” Zach Pandl, Goldman Sachs co-head of global emerging markets foreign exchange, rates, and strategy, said in the report. The panel argues that bitcoin will increasingly steal market share from gold, which has stagnated at roughly $1,800 an ounce.
He said that bitcoin currently represents about 20% of the so-called “store of value” market, a term used to describe gold, bitcoin, and other alternative assets such as currencies and commodities whose prices, in theory, should not depreciate much over a long period. of time.
The panel believes that eventually, bitcoin could account for 50% of the store of value market, which could propel the cryptocurrency 17-18% higher annually over the next five years to exceed $100,000.
“We believe that comparing its market capitalization to gold can help benchmark plausible outcomes for bitcoin returns,” Pandl added. Of course, bitcoin and other major cryptocurrencies like ethereum, finance, Solana, and meme tokens like dogecoin and Shiba Inu have been extremely volatile in the past year. Cryptocurrencies are behaving more like stocks than currencies right now.
Still, a growing number of top fund managers, including Stanley Druckenmiller, Paul Tudor Jones, and George Soros, have invested in bitcoin. Regulators have approved exchange-traded funds that also track bitcoin futures prices, making it even easier for individual investors to dip into the market.