Goldman Sachs said in a presentation on Wednesday that bitcoin “is not an asset class,” nor is it “a suitable investment”, while JPMorgan’s latest report affirmed the intrinsic value of bitcoin.

Is bitcoin an asset? What is its value logic? Is bitcoin a promising investment? SheKnows, an 8btc interview column, invited Gu Yanxi, Chinese and American securities market experts and Wu Tong, a famous scholar of blockchain and digital economy to have a discussion.

Overall attitude to Goldman Sachs meeting: lack of new ideas

Gu Yanxi: Goldman’s view that bitcoin is not of investment value is not surprising at all, which is a very typical conservative view. Like Buffett said in 2018 that bitcoin is the square of rat medicine and a toxic asset and the new governor of the Bank of England says anyone holding bitcoin should be prepared for losses. Most of the content of this report is to analyze the overall economic situation and some mainstream suggestions for customers, but the analysis of bitcoin price is not in-depth.

Wu Tong: Goldman Sachs is a leading financial investment institution. Its risk tolerance and capital volume are totally different from that of individual investors. Therefore, the content of the report has no reference value for individual investors.

From the content of the report, in terms of logic, Goldman Sachs’s arguments on bitcoin investment proposal are lack of new ideas, a large number of arguments are deliberately ignored.

Goldman’s opinion is not the general view of Wall Street financial giants but represents the view of some old schools.

I think Goldman’s view will change in the future as the attitude of financial institutions on Wall Street has always been changing, including JPMorgan Chase who gave the intrinsic value of bitcoin had been shorting bitcoin before.

Qualitative: Is bitcoin an asset class? Is it a digital gold?

Wu Tong: Goldman Sachs believes that bitcoin does not belong to the asset category. This statement does not mean that bitcoin is not an asset, but does not belong to the asset category that existing investors are familiar with or have been studied thoroughly.

There are many definitions of assets. From one point of view, assets are resources that are expected to bring economic benefits in the future. For example, if you invest in bitcoin, as long as you do not add leverage, as long as bitcoin is not go zero, you can earn benefits in the future.

In short, I think bitcoin can show some gold-like properties. I think it is very wrong to analyze the correlation between gold and bitcoin from payment tools. Since gold became non-monetary in the 1970s, it has not been used as a payment instrument.

Bitcoin is actually a contradictory unity of risk and avoidance, but avoidance and risk are not a coordinate system of positive and secondary coordinates, but two completely different attributes.

Gu Yanxi : Goldman’s report is nothing new. It’s just a science popularization. Bitcoin is certainly not a currency or a security. The CFTC defines bitcoin as a virtual asset, a product that can be traded in compliance with the US market.

The whole blockchain space has always believed that bitcoin is digital gold, which is wrong. As a means of payment and a safe-haven asset, gold is a long-term consensus in human economic life. So far, bitcoin has not been able to become a payment tool, and has not proved that it is more convenient than fiat money. Bitcoin is now the result of consensus, which is empty, and the foundation is very weak.

Pricing: Is bitcoin valuable? What is the value logic? How to price it?

Gu Yanxi: There are two levels of definition of its value, one is use value, the other is the result of market consensus.

Bitcoin has no use value, but it has a market value of about $170 billion, which I think is the result of consensus. The power of human consensus is great, but bitcoin will crumble one day.

The original intention of bitcoin design is to solve the problems of fiat money in the market, so the biggest enemy of bitcoin is fiat money and who is behind it? It’s all sovereign governments. Sovereign governments will never allow bitcoin to circulate freely in their own jurisdictions.

At present, the two main factors supporting bitcoin price are trading media and trading platform. USFT accounts for most of the market share in the trading media. Will US regulators take regulatory measures against USDT, there is a general expectation in the market that it will happen. Once that happens, what is the value of the USDT? If there is no trading medium, what do you use to form the price of bitcoin?

Gu Yanxi: There are two levels of definition of its value, one is use value, the other is the result of market consensus.

Bitcoin has no use-value, but it has a market value of about $170 billion, which I think is the result of consensus. The power of human consensus is great, but bitcoin will crumble one day.

The original intention of bitcoin design is to solve the problems of fiat money in the market, so the biggest enemy of bitcoin is fiat money and who is behind it? It’s all sovereign governments. Sovereign governments will never allow bitcoin to circulate freely in their own jurisdictions.

At present, the two main factors supporting bitcoin price are trading media and trading platform. USFT accounts for most of the market share in the trading media. Will US regulators take regulatory measures against USDT, there is a general expectation in the market that it will happen. Once that happens, what is the value of the USDT? If there is no trading medium, what do you use to form the price of bitcoin?

Market impact: How will the investment bank’s judge influence the bitcoin market?

Gu Yanxi: There is no doubt that Goldman Sachs will affect its clients. Goldman Sachs is a typical view of the old school. It just repeats this point. And I’m sure they’ll keep their point of view so that there won’t be any volume flowing into bitcoin that will cause it to rise.

Wu Tong: I don’t think there is any impact in the short term, but there will be some negative impact in the long term.

Bitcoin has its own private area. Goldman Sachs users are not the main investors of bitcoin. The negative information about bitcoin published by Goldman Sachs is not beyond the expectation of the market. There is no new information in the words of the financial market, so it has no impact on the existing market stock. In the long run, there will be some negative effects, like the psychological impact on potential customers. Goldman Sachs instilled this negative idea into customers.