Goldman Sachs says bitcoin is a commodity
- Bitcoin is more like gold than the US dollar, Jeff Currie, Goldman Sachs' head of commodities research, said in an interview with Bloomberg TV.
- Bitcoin doesn't have the same amount of liquidity as gold though, which is the primary difference between the two.
- Watch bitcoin's price move in real time here.
Bitcoin is a commodity, just like gold, according to Goldman Sachs' Jeff Currie, global head of commodities research.
Currie laid out his simple thinking behind why he sees bitcoin as a commodity, instead of a security or a currency, in an interview with Bloomberg TV:
Currie's argument is that bitcoin doesn't answer to anyone. The price is set by the market and isn't backed by a central government, public company or private entity, just like gold.
Bitcoin is much more volatile than gold, however, and Currie explains that liquidity is the main cause of this. There is $8.3 trillion worth of gold above ground, while bitcoin has a market cap closer to $165 billion, making it much more volatile and much less liquid.
"Central banks control an enormous amount of the supply of gold, which does not make it a complete substitute between bitcoin and gold," Currie said.
Curries comments came as bitcoin crossed, then fell back below, $10,000 a coin for the first time. Other, smaller cryptocurrencies like ether and litecoin also touched all-time highs on Wednesday.
Goldman Sachs CEO Llyod Blankfein has stated previously that he is "still thinking" about bitcoin and hasn't come to any conclusions yet. The bank has said it is looking into how best to serve its clients interested in digital currencies, however.
Bitcoin's meteoric rise has grabbed the attention of more traditional players on Wall Street. Business Insider reported on Wednesday that Nasdaq, the exchange operator, plans to begin offering bitcoin futures next year. CME and Cboe, two exchange giants, have also announced plans to offer bitcoin futures, which could help with volatility in the market.
