“In recent decades the U.S. dollar has served its purpose relatively well,” Goldman Sachs strategists Zach Pandl and Charles Himmelberg wrote in a report Wednesday.
But “in those countries and corners of the financial system where the traditional services of money are inadequately supplied, Bitcoin (Bitcoin) (and cryptocurrencies more generally) may offer viable alternatives.”
Nonetheless, the investment bank warns against expecting 2017-level returns:
“Our working assumption is that long-run cryptocurrency returns should be equal to (or slightly below) growth in global real output—a number in the low single digits. Thus, digital currencies should be thought of as low/zero return or hedge-like assets, akin to gold or certain other metals.”
The strategists believe that Bitcoin could also be useful in regions where governments impose strict rules on the use of traditional currencies from other countries.