Being a Bitcoin supporter in 2018 is a thankless task, with precious few highs and seemingly endless lows. The latest of those lows occurred earlier today (Sunday August 5) when BTC slipped below the $7,000 mark – something that looked confined to the past, or so we thought.
Inexplicably, the price of Bitcoin is falling yet again, and several hours ago today (Sunday, August 5) it was down to $6,998, heartbreaking for investors when one considers it was over $8,400 little more than a week ago. Unfortunately, until the day comes when vast amounts of Bitcoin are owned by corporate investors rather than scores of private individuals, as it is now, the price is likely to remain low and continue to fluctuate.
As long as Bitcoin’s status is held at the whim of clearly flakey individuals prone to panic selling, we are going to get scenarios such as this one, which saw Bitcoin’s value fall by 5% in 24 hours. Ironically, one can expect a mini-surge in Bitcoin purchases at this new cheaper rate, so don’t be too surprised if within a day or two, the value of BTC is once again heading toward $7,500 and above.
Goldman Sachs The Most Likely Culprits
Despite striking a deal earlier this year to sell Bitcoin via their New York branch, banking behemoth Goldman Sachs have never had anything approaching a good relationship with cryptocurrency, including Bitcoin.
Late last week they released their latest economic outlook report, a 42-page dossier sent out to all of their clients. Included in this report is a brief but damning summary of their opinion on cryptocurrency and its future. It is the belief of the Goldman Sachs’ investment strategy team that the main issue with cryptocurrency is that it “will not retain value”, as exemplified by all of the major cryptos remaining 60% or more down on their peak values, reached during the period from November 2017 to January 2018. Also, considering cryptocurrencies account for a mere 0.3% of the global GDP, the coverage they receive via mainstream and social media is massively disproportionate.
Here are two key quotes from the report:
“Our view that cryptocurrencies would not retain value … remains intact and, in fact, has borne out much sooner than we expected.”
“Digital currencies garner far more traditional media and social media attention than is warranted.”
Ironically, despite their negative tone toward digital currency, Goldman Sachs has reportedly been developing their own cryptocurrency trading desk since December 2017, so its release could be imminent.