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‘Arrogant’ to Think Bitcoin Won’t be Successful – Goldman Sachs CEO

Lloyd Blankfein, the chief of investment bank Goldman Sachs, has denounced cynics who believe that Bitcoin and cryptocurrency do not have the prospect to survive.

Though he has emphasised the fact that the cryptocurrency market hasn’t been a major asset class, Blankfein has called on the investors to at least recognise the potential of the sector.

Blankfein, at the Economic Club of New York conference, said:

“If you go through that fiat currency where they say this is worth what it’s worth because I, the government, says it is, why couldn’t you have a consensus currency?”

In an interview with CNBC’s Kayla Tausche, Blankfein described a similar phase in the US history where the government abolished the then legal tender, gold and replaced it with a currency of zero value, the US dollar. Naturally, the businessmen and individuals found it difficult at that time but eventually adapted to the new currency. Similarly, when the time is ripe and there is a need to move on from the fiat currency to digital currency, Bitcoin could play a crucial role.

“A five dollar gold coin was worth five dollars because it had five dollars worth of gold in it. Then they issue paper money that is backed by gold in the treasury. Then one day, they issue paper money that does not have the backing of gold. There was no pledge that if you turn it in, I’ll give you five dollars of gold. It is fiat money. I say this piece of paper is worth five dollars and so, therefore, it is five dollars and a lot of people did not take that for a long time. But, now they do without question. You move a little bit further and you get Bitcoin that is not a fiat currency so I don’t trust it and I don’t like it. On the other hand, if it works, I say maybe it was a natural progression from hard money to digital money”, said Blankfein.

 

David Solomon, COO of the investment bank, earlier confirmed the rumours about Goldman Sachs setting up a cryptocurrency trading desk beyond futures

He said that the bank has been testing cryptocurrency trading with a close eye and will soon launch a cryptocurrency trading desk very soon.

“We are listening to our clients and trying to help our clients as they’re exploring those things too,” said Solomon.

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