LONDON, Jan. 5 (Reuters) – Bitcoin will pull market share away from gold in 2022 as digital assets are increasingly adopted, Goldman Sachs analyst Zach Pandl said in a research note to clients.

Citing bitcoin’s $ 700 billion market capitalization, compared to around $ 2.6 trillion in gold held as an investment, Goldman Sachs said the cryptocurrency currently holds a 20% market share of ” store of value “.

Bitcoin will “very likely” become a larger proportion over time, Goldman Sachs said, in a 2022 forecast listing.

In a hypothetical scenario in which bitcoin would take 50% of that market’s share, its price would rise to just over $ 100,000, according to the note.

Bitcoin was trading around $ 46,073 on Wednesday, after struggling to make gains after falling sharply in early December. In November, it had reached an all-time high of $ 69,000.

“Bitcoin may have applications beyond a simple ‘store of value’ – and digital asset markets are much more important than Bitcoin – but we believe that comparing its market capitalization to gold can help define parameters on plausible outcomes for Bitcoin returns, ”Pandl wrote.

The term “store of value” generally describes assets that can retain their value over time without depreciating, such as precious metals or certain currencies.

Goldman Sachs restarted its cryptocurrency trading desk in 2021. read more

Reporting by Elizabeth Howcroft; Editing by Saikat Chatterjee

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