Ethereum, the second-largest cryptocurrency in the world, recently received support from Goldman Sachs, one of the leading American investment banks.
In a research note on Tuesday, the New York investment bank Goldman Sachs mentioned that Ethereum growing popularity makes it a prime contender to overtake Bitcoin as the most valuable digital currency.
According to a report, the investment bank believes that Ethereum currently looks like the cryptocurrency with the most real potential. The report said it is the most popular smart contract app development platform.
Ethereum may overtake Bitcoin as the dominant digital store of value in the coming years, according to a report published by Business Insider citing the latest research note from Goldman Sachs.
However, Goldman Sachs believes that the growing competition between various cryptocurrency assets, including Ethereum, Bitcoin, Binance Coin, and Cardano, is a major risk factor.
Goldman Sachs research note writes:
“ETH currently looks like the cryptocurrency with the highest real use potential as Ethereum, the platform on which it is the native digital currency, is the most popular development platform for smart contract applications. The competition among cryptocurrencies is another risk factor that prevents them from becoming safe-haven assets at this stage,”
Goldman Sachs noted that despite the latest surge in the popularity of cryptocurrency assets like Ethereum and Bitcoin, none of them will be able to overtake Gold anytime soon. The bank highlighted the risky nature of digital currencies.
The research says:
“Gold is competing with crypto to the same extent it is competing with other risky assets such as equities and cyclical commodities. We view Gold as a defensive inflation hedge and crypto as a risk-on inflation hedge.”