“Bitcoin is now seen as an investable asset. It contains strange risk, partly due to it being new and going through new adoption,” said Goldman Sachs’ digital assets department leader, Mathew McDermott, in his new published research.
“It does not act as you might expect given the digital gold analogy; it has tended to be more like risk-on assets. But investors are treating it as a new asset type.”
Despite Goldman’s approval of bitcoin (BTC-USD), it and other cryptocurrencies have behaved nothing like the typical stock of a large company.
The truth is, if bitcoin can be seen as a new asset type, it is a lot like one part of the stock market: volatile penny stocks that undergo wild changes on the smallest bit of news.
Bitcoin prices were under massive pressure recently, pulling back by over 15% during weekend trading.
At $32,652, bitcoin crashed around 50% from its mid-April high of $64,829. Meanwhile, Ether dropped another 18%, bringing its total decline from its high to roughly 60%. Early on Monday, crypto regains some of its lost ground.