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Asset managers, barriers to entry, bitcoin fomo, bitcoin market, cryptocurrency fomo, crypto market, fear of missing out, FOMO, Goldman Sachs clients, Goldman Sachs, Goldman Sachs Bitcoin, institutional investors
Investment bank Goldman Sachs stated that institutional investors and asset management companies were forced to switch to Bitcoin because of “fear of missing out” (FOMO). Goldman Sachs now sees Bitcoin as a new asset class. Nonetheless, institutional investors face several powerful obstacles when entering the cryptocurrency market.
Goldman Sachs (Goldman Sachs) said on Monday that it is worried that investors may miss the potential gains of cryptocurrencies, which may lead to an increase in FOMO prices. Mathew McDermott, Global Head of Digital Assets at Goldman Sachs, said in a report to clients:
Undoubtedly, given how many bitcoins and other crypto assets have appreciated, and how many interested participants of different tastes have jumped into this field, “fear of missing” (FOMO) has played a role.
Despite the recent increase in liquidity in the cryptocurrency market, the analyst said: “It is still difficult for institutions to enter the market, and the market is still fragmented.”
If you are an asset manager or manage a large fund, and your closest competitors are investing [in cryptocurrency] Seeing substantial returns, your investors will naturally wonder why you are not investing [in the asset class].
McDermott continues to share key questions raised by Goldman Sachs customers to prevent them from increasing their exposure to Bitcoin or other cryptocurrencies.
First of all, McDermott said: “For companies, increasing participation usually depends on whether the board considers the nature of the company and its objectives to make sense.” Goldman Sachs analysts pointed out: “Some investment funds and asset managers do not Quan invests part of its portfolio in cryptocurrencies.”
The second obstacle is “How can customers easily enter the market, are they liquid enough to meet their needs, and are they satisfied with the custody and security aspects of managing these assets?”
In addition, some clients questioned whether exposure to cryptocurrency is the right choice, and whether it makes sense for their investment strategy, portfolio or balance sheet, the analyst said. Nevertheless, he emphasized:
As evidenced by the increase in inflows, more and more entities have begun to understand the crypto space and have become comfortable.
What do you think of Goldman Sachs’ analysis? Let us know in the comments section below.
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