Goldman Sachs: Ethereum Could Overtake Bitcoin as a Store of Value

Real-world use cases for Ethereum give the asset potential to become the dominant digital store of value in the coming years. This, according to Business Insider citing a Goldman Sachs analytical note.

“Ethereum currently appears to be the cryptocurrency with the greatest potential utility, as the platform for which it is the native digital currency is the most popular for developing smart-contract applications,” the investment bank said.

Bitcoin has a strong brand, given the first-mover advantage, but it lacks use cases, partly due to its low transaction speed, Goldman Sachs experts noted.

However, regardless of which cryptocurrency dominates, none of them will surpass gold as a safe asset in the near term, the bank believes.

“Gold competes with cryptocurrency to the same extent as it does with other risky assets, such as equities and cyclical commodities. We view the precious metal as a defensive inflation hedge, and cryptocurrency as a risk asset,” the Goldman Sachs specialists explained.

The ability of cryptocurrencies to become an asset class that investors consider safe is also undermining competition between them, the experts concluded.

Earlier, Charles Hoskinson, the head of IOHK, the company behind Cardano, said that Bitcoin will lose the competitive fight to Ethereum.

Earlier in May 2021, Goldman Sachs recognised cryptocurrencies as an asset class, and a month later voiced the opposite view.

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