- Bitcoin is more like gold than the US dollar, Jeff Currie, Goldman Sachs’ head of commodities research, said in an interview with Bloomberg TV.
- Bitcoin doesn’t have the same amount of liquidity as gold though, which is the primary difference between the two.
- Watch bitcoin’s price move in real time here.
Currie laid out his simple thinking behind why he sees bitcoin as a commodity, instead of a security or a currency, in an interview with Bloomberg TV:
“It’s a commodity. A security, by definition, has a liability attached to it. Take a dollar bill, it has a liability to the US government. Commodities do not have liabilities. They are bearer assets, and when you think about it in that context, you look at bitcoin, it’s not that much different than gold. I don’t see why there’s all this hostility toward it.”
Currie’s argument is that bitcoin doesn’t answer to anyone. The price is set by the market and isn’t backed by a central government, public company or private entity, just like gold.
Bitcoin is much more volatile than gold, however, and Currie explains that liquidity is the main cause of this. There is $8.3 trillion worth of gold above ground, while bitcoin has a market cap closer to $165 billion, making it much more volatile and much less liquid.
“Central banks control an enormous amount of the supply of gold, which does not make it a complete substitute between bitcoin and gold,” Currie said.
Curries comments came as bitcoin crossed, then fell back below, $10,000 a coin for the first time. Other, smaller cryptocurrencies like ether and litecoin also touched all-time highs on Wednesday.