Bitcoin's gold rival, according to Goldman Sachs, could soar to $100,000 as crypto prices plummet

According to Goldman Sachs analyst Zach Pandl in a research briefing note, Bitcoin's price could reach $100,000 in four years if more investors see the cryptocurrency as a store of wealth.

According to him, bitcoin now accounts for 20% of the 'store of value' market, with a stock of bitcoin available for investment valued at around $700 billion, compared to $2.6 trillion in gold held as an investment.

In a hypothetical scenario, Pandl calculated that bitcoin's price would reach $100,000 if it gained 50% of the store of value market.

"Bitcoin may have applications beyond simply a ‘store of value' - and digital asset markets are much bigger than Bitcoin," he said, "but we think that comparing its market capitalisation to gold can help put parameters on plausible outcomes for Bitcoin returns."

While the CEO of one of the world's largest independent financial advisory, asset management, and fintech organizations, deVere Group's Nigel Green, predicted on the 6th of January that Bitcoin and cryptocurrency prices will "robustly rebound" after suddenly plummeting on Wednesday evening, 5th of January after minutes from the US Federal Reserve's last meeting were published.

At 10.25 a.m. UK time on the 5th of January, the price of Bitcoin had dropped from over $47,000 to $42,737.

"The minutes from the Fed have increased expectations that the central bank of the world's largest economy will now move faster to raise interest rates to fight soaring inflation," he said.

"As a result, there's been a knee-jerk sell-off on Wall Street and the crypto market as it is perceived by some traders that such a move puts at risk the liquidity that has benefitted many asset classes, including Bitcoin."

"However, I believe that we will see Bitcoin robustly rebound as the dust settles," he added. "This will then boost others in the crypto market."

"This is because Bitcoin and other digital currencies are widely regarded as a shield against inflation mainly due to its limited supply, which is not influenced by its price."

"In this latest inflationary period, Bitcoin has outperformed gold which, until now, has always been almost universally hailed as the ultimate inflation hedge."

By fLEXI tEAM