An executive at multinational investment bank Goldman Sachs believes an increase in the participation from institutional investors is the â€œkeyâ€� to stabilizing nascent markets such as cryptocurrencies.
Speaking on CNBCâ€™s The Coin Rush on Tuesday, Goldman Sachsâ€™ global head of commodities research, Jeff Currie, said the cryptocurrency market â€œis becoming more matureâ€� but still has a way to go.
â€œRight now theyâ€™re [institutional investors] small â€¦ about $700 billion dollars of money in bitcoin right now, of that roughly one percent of it is institutional money,â€� said Currie.
Currie, who is the global head of commodities and research, also said bitcoin is a defensive asset similar to gold. He raised goldâ€™s $3 trillion market, saying some of that money could be allocated to cryptocurrency.
â€œRight now all of the cryptocurrencies have about a trillion [dollars], letâ€™s say it grows to $2 trillion, then you just do the simple math â€“ how many coins are out there divided by that, and you can end up with a fair value.â€�
That valuation assessment could help provide a long-term equilibrium, but the in and outflows of money in bitcoin create a lot of volatility and a lot of uncertainty that made it difficult to forecast, Currie said.
The post Goldman Sachs Exec Says More Institutional Investment Would Calm Bitcoin Volatility appeared first on TechFans.