Goldman Sachs: Bitcoin’s meteoric rise ‘pushed it into bubble territory’

Anytime you turn on CNBC, read The Wall Street Journal, or peruse a financial blog, you will see a headline like: Financial Analysts Declares Bitcoin the Biggest Bubble in History.

Therefore, whenever Wall Street sends a stern warning about the peer-to-peer decentralized virtual currency, most people don’t pay attention anymore.

That isn’t stopping the barrage of warnings.

Goldman Sachs, one of the biggest financial institutions in the world today, issued a warning about bitcoin. It essentially concluded that there is “no doubt” last year’s substantial increase “pushed it into bubble territory.”

“Bitcoin’s meteoric rise in a short time has dwarfed the rise seen during the dot-com bubble,” Goldman Sachs said in a note to clients. “We also believe that cryptocurrencies have moved beyond bubble levels in financial markets, and even beyond the levels seen during the Dutch ‘tulipmania’ between 1634 and early 1637.”

It is unsure if its value is sustainable long-term.

“While we do not know if bitcoin or any other cryptocurrency will double or triple from prevailing prices, we do not believe that these cryptocurrencies will retain their value in the long run in their current incarnation,” the company wrote.

At the time of this writing, bitcoin is trading just under $11,200.

Move over Jamie Dimon and Alan Greenspan, Goldman Sachs is the newest target.

Like this article? Get ECN delivered to your inbox daily. Subscribe here.

Leave a Comment