The chief investment officer of Goldman Sachs’ Wealth Management unit does not see cryptocurrency as an investment asset class. She also believes that bitcoin “creates absolutely no value in any shape or form.” Her perspective differs from that of some other Goldman Sachs executives regarding bitcoin and cryptocurrencies.
‘We Do Not Think It Is an Investment Asset Class’
The chief investment officer of Goldman Sachs’ wealth management unit, Sharmin Mossavar-Rahmani, discussed her perspective on bitcoin and other cryptocurrencies in a Wall Street Journal interview last week. Mossavar-Rahmani has served as the chief investment officer of Goldman Sachs Wealth Management for the past 23 years.
She compared the recent crypto enthusiasm to the tulip mania of the 1600s, dismissing it as nothing more than a means of speculation. She opined:
We do not think it is an investment asset class … We’re not believers in crypto.
Furthermore, she insisted that bitcoin “creates absolutely no value in any shape or form.”
Mossavar-Rahmani clarified that her perspective stems from the challenge of accurately valuing cryptocurrencies, as they do not generate earnings, cash flow, or dividends. She asked rhetorically:
If you cannot assign a value, then how can you be bullish or bearish?
Goldman Sachs launched its crypto trading desk in 2021. The bank currently offers cash-settled bitcoin and ether option trading along with CME-listed bitcoin and ether futures. It does not directly trade the underlying crypto assets.
Cryptocurrency’s allure for some stems from a distrust of traditional financial institutions. Critics argue that central banks, like the one that loosened monetary policy before the 2008 crisis, have eroded trust in the dollar and other fiat currencies. However, proponents like Mossavar-Rahmani believe governments, despite occasional mistakes, play a vital role in society. She also raises concerns about the potential for cryptocurrencies to be used for criminal activity. Mossavar-Rahmani stressed:
The rule of law and systems of checks and balances matter.
She further asserted that crypto bulls “all proclaim democratization of finance, yet the main decisions end up being driven by a few controlling people.”
While Mossavar-Rahmani is skeptical of crypto and bitcoin, Max Minton, Goldman’s Asia Pacific head of digital assets, said last week that many of the global investment bank’s largest clients are active or exploring getting active in the crypto space. Goldman Sachs’ head of digital assets, Mathew McDermott, similarly stated that the firm is seeing more institutions diving into crypto.
What do you think about Goldman Sachs’ Sharmin Mossavar-Rahmani stating that crypto is not an investment asset class and that bitcoin has no value? Let us know in the comments section below.
Source: Bitcoin
