$1 Trillion Crypto Crash: Goldman Sachs’ Reveals Huge Bitcoin Price Prediction After Ethereum Bet

$1 Trillion Crypto Crash: Goldman Sachs’ Reveals Huge Bitcoin Price Prediction After Ethereum Bet

Bitcoin and cryptocurrencies have had a dreadful start to 2022, continuing the downward trend from the end of last year as price pressures mount.

The bitcoin price has lost around 40% since peaking in November, down from almost $70,000 per bitcoin to lows this week of $41,000. Meanwhile, ethereum and other major coins have also crashed back, wiping around $1 trillion in value from the crypto market since its November high.

Now, Wall Street giant Goldman Sachs , has predicted bitcoin will increasingly compete with gold as a "store of value"—and could hit $100,000 within five years.

"Bitcoin may have applications beyond simply a "store of value"—and digital asset markets are much bigger than bitcoin—but we think that comparing its market capitalization to gold can help put parameters on plausible outcomes for bitcoin returns," Zach Pandl, co-head of foreign exchange strategy at Goldman Sachs, wrote in a research note.

"Hypothetically, if bitcoin's share of the store of value market were to rise to 50% over the next five years (with no growth in overall demand for stores of value) its price would increase to just over $100,000, for a compound annualised return of 17% to 18%."

Bitcoin's reputation as a digital store of value similar to gold has been propelled by the soaring inflation that's hit economies around the world over the last year. In May 2020, renowned investor Paul Tudor Jones put bitcoin firmly on Wall Streets's map when he named it as a "the fastest horse to beat inflation."

"Bitcoin has superior monetary qualities to gold, and once it reaches a critical mass of adoption as a store of value, bitcoin has huge potential to grow into a global reserve currency and universal unit of account," Hong Fang, the chief executive of Okcoin, said in emailed comments, pointing to bitcoin's scarcity via its fixed supply of 21 million coins, its digital durability and accessibility, as well as its censorship resistance.

"Bitcoin is not just an asset class—the bitcoin network is proving to be a viable global payment network, with bitcoin being programmable money," added Fang. "In 2022, we’ll continue to see BTC prove itself as not just a store of value, but also a medium of exchange and unit of account."

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