According to Goldman Sachs Group Inc.’s global head of investment research, Steve Strongin, most digital currencies are unlikely to survive in their current form, and investors should prepare for coins to lose all their value as they’re replaced by a small set of future competitors, Bloomberg reports.
Recent price swings indicated a bubble and that the tendency for different tokens to move in lockstep wasn’t rational for a “few-winners-take-most” market.
“The high correlation between the different cryptocurrencies worries me.”
“Because of the lack of intrinsic value, the currencies that don’t survive will most likely trade to zero.”
“Are any of today’s cryptocurrencies going to be an Amazon or a Google, or will they end up like many of the now-defunct search engines? Just because we are in a speculative bubble does not mean current prices can’t increase for a handful of survivors.,”
“At the same time, it probably does mean that most, if not all, will never see their recent peaks again.”