Goldman Sachs believes that cryptocurrencies could succeed as money

Although Bitcoin does not solve any problem in the US In the US, where transaction costs are already low and the dollar stable, in developing countries, digital currencies could succeed as a real form of money, says Goldman Sachs Group Inc.

Many currencies in sub-Saharan Africa have lost value due to high inflation and mismanagement by governments. As a result, foreign money accounts for more than 90 percent of deposits and loans in the Democratic Republic of the Congo, and Zimbabwe demonetized its currency in 2015. Bitcoin could also be useful in regions where governments impose strict rules on the use of currencies traditional from other countries.

“In the last few decades, the US dollar has served its purpose relatively well,” Goldman Sachs strategist Zach Pandl and Charles Himmelberg wrote in a report. But “in those countries and corners of the financial system where traditional money services are not adequately provided, Bitcoin (and cryptocurrencies in general) can offer viable alternatives.”

The report also warned that if digital currencies become a widely used form of currency, investors should not expect the astronomical returns that have recently attracted unprecedented attention to the world of cryptocurrencies.

“Our working assumption is that long-term cryptocurrency yields should be equal (or slightly lower) to the growth of real world production, a number in the digits of a single digit,” the strategists said. “Therefore, digital currencies should be considered low or no returns or hedge assets, similar to gold or other metals.”

Enric Martí

Enric Martí

Economy fan, hangued, hooked on crytocurrencies and junkie of audiovisual stuff...on rehab