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Major investment bank Goldman Sachs says ether is the cryptocurrency with the highest real use potential and it could overtake bitcoin as the dominant digital store of value.
In a note published on Tuesday, major investment bank Goldman Sachs shared its view on the future of bitcoin and ether. According to the note, the bank’s analysts believe that Ether could potentially overtake Bitcoin as the dominant store of value:
“[Ether] currently looks like the cryptocurrency with the highest real use potential as Ethereum, the platform on which it is the native digital currency, is the most popular development platform for smart contract applications.”
Nonetheless, Goldman Sachs still prefers gold, as it does not believe that neither or any cryptocurrency will soon be able to overtake gold. The bank believes that cryptocurrencies’ high volatility makes them not a direct competitor to gold as a safe-haven asset. The note stated:
“Gold is competing with crypto to the same extent it is competing with other risky assets such as equities and cyclical commodities. We view gold as a defensive inflation hedge and crypto as a risk-on inflation hedge.”
Analysts also said that the competition between different cryptocurrencies is actually hurting crypto and its option as a safe asset class for investors:
“This competition among cryptocurrencies is another risk factor that prevents them from becoming safe-haven assets at this stage.”
Earlier in the year, in April, JPMorgan explained why they believe Ether was outperforming Bitcoin. In the report titled “Why is ETH outperforming”, the firm’s analysts provided a thorough analysis.