Crypto EcoBlog
Per the Goldman Sachs report, the support for the narrative that Bitcoin’s scarcity is what makes it a veritable store of value is no longer tenable.American multinational financial services firm, Goldman Sachs Group Inc (NYSE: GS) has waded into the dominance debate between Bitcoin (BTC) and Ethereum (ETH), with clearly defined support for the latter. Excerpts of the leaked Global Macro Research report from the bank, which was shared on Twitter by Santiago Santos, General Partner at ParaFi Capital, saw the bank tackle and analyze the key arguments that back Ethereum to flip Bitcoin as the major store of value in the near future. Goldman Sachs noted that the tag of the Ethereum blockchain as a potential store of value draws on its growing use cases as it hosts a large number of DApps and
Topics:
<title> considers the following as important:
This could be interesting, too:
Wayne Jones writes South Korea’s Crypto Investor Base Increased by 21% in 2024 H1: Report
Jordan Lyanchev writes Is This The Last Week Bitcoin (BTC) Will Ever Be Below K?
Wayne Jones writes RWA Sector Poised for 0B Growth by 2030: Report
CryptoVizArt writes Ripple Price Analysis: is XRP About to Crash Much Lower Than %related_posts%.5?
Per the Goldman Sachs report, the support for the narrative that Bitcoin’s scarcity is what makes it a veritable store of value is no longer tenable.
American multinational financial services firm, Goldman Sachs Group Inc (NYSE: GS) has waded into the dominance debate between Bitcoin (BTC) and Ethereum (ETH), with clearly defined support for the latter. Excerpts of the leaked Global Macro Research report from the bank, which was shared on Twitter by Santiago Santos, General Partner at ParaFi Capital, saw the bank tackle and analyze the key arguments that back Ethereum to flip Bitcoin as the major store of value in the near future.
Goldman Sachs noted that the tag of the Ethereum blockchain as a potential store of value draws on its growing use cases as it hosts a large number of DApps and smart contracts. The entire new niche of decentralized finance was arguably spearheaded by the Ethereum blockchain with the network’s native cryptocurrency, the Ether powering transactions in the ecosystem.
“Given the importance of real uses in determining the store of value, Ether has high chance of overtaking Bitcoin as a dominant store of value. The Ethereum ecosystem supports smart contracts and provides a way to create new applications on its platform. Most decentralized finance (DeFi) applications are being built on the Ethereum network, and most non-fungible tokens (NFTs) issued are purchased using Ether. The greater number of transactions in Ether versus Bitcoin reflects this dominance,” the report reads.
The utility of the Ethereum blockchain was also reiterated with respect to the possibility to store digital information, for which tokens can be issued in returns. This creates a growing niche for Non-Fungible Tokens (NFTs), a rare piece of collectibles or digital assets that can be traded. Ethereum hosts a number of NFTs and purchases, which is usually done through the ETH cryptocurrency.
“Unlike bitcoin, ethereum is not just a value token, meaning it actually fuels all use cases built on top of the ETH blockchain,” Kosala Hemachandra, the chief executive of MyEtherWallet, said corroborating the Goldman Sachs position while pointing to “DeFi, NFTs, decentralized applications.”
Goldman Sachs Report: Demand Not Scarcity Defines the Right Store of Value
Per the Goldman Sachs report, the support for the narrative that Bitcoin’s scarcity is what makes it a veritable store of value is no longer tenable. The banking giant posited that increasing demand is what defines a true store of value and Ethereum checks the box in this regard.
Bitcoin’s supply is capped at 21 million while Ethereum has no cap but with a defined rate of supply per year. Per the former coin’s supply model, the report noted it can pave the way for financial bubbles as investors will be in a frantic race to outbid one another. The latter on the other hand is closely aligned to the century-old known store of value, Gold with unlimited supply and a certain level of annual sustainable growth rate.
Additionally, a leaked portion of the report highlighted the first-mover advantage of Ethereum as it is pursuing a switch to an energy-efficient and more scalable Proof-of-Stake (PoS) model. The failure to continually upgrade in response to network demand and competition is also a basis for Goldman Sach’s projection that Ethereum will outshine Bitcoin in the future.
At the time of writing, Bitcoin is trading at $38,451.74, atop $703.1 billion market cap, and Ethereum is exchanging hands at $2,434.17 with a total capitalization of $273.59 billion.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.