A recent report by Goldman Sachs lauded the potential for Ethereal to rise and become the market’s cryptocurrency of choice, adding to the latest chorus of anti-Bitcoin skeptics.
According to a recent report by Goldman Sachs, Ethereum has the potential to overtake Bitcoin as the top crypto due to its relatively diverse capabilities for various applications that could lead it to become the «Amazon of trusted information».
«Many investors now view bitcoin as a digital store of value, comparable to gold, housing, or fine wine,» the report said. «But all true stores of value in history have provided either income or utility, and bitcoin currently provides no income and only very modest utility,»
Real Uses
In contrast, Goldman Sachs highlighted various real-life applications that Ethereum has already showcased across decentralized finance, gaming, non-fungible tokens and stable coins.
«Over time, the decentralized nature of the network will diminish concerns about storing personal data on the blockchain,» the report said, naming possible examples of other tokenizable and tradable information such as asset ownership, medical history and intellectual property rights.
«Given the importance of real uses in determining store of value, ether has high chance of overtaking bitcoin as the dominant digital store of value.»
Digital Gold
The report also said that «the rise in bond yields and the eventual normalization of monetary policy is putting downward pressure on bitcoin as a form of digital gold, the same way higher real yields have been putting downward pressure on traditional gold».
Interestingly, Goldman Sachs also notes that greater adoption of the Ethereum blockchain and its Proof of Stake (PoS) system – a method that can scale Ethereum by requiring users to use stakes to become a validator in the network – will require a scarce resource to power.
«Ironically, this is likely where the value of and demand for bitcoin will come from – being used as the scarce resource to make the PoS system work instead of natural resources,» the report said.
