Unlike many other investors out there, Goldman Sachs is pessimistic regarding the short-term future of cryptocurrencies as is apparently visible in its mid-year economic report released in July 2018.

Sharmin Mossavar-Rahmani, chief investment officer of the Investment Strategy Group, Goldman said in the report,

“ We expect further declines in the future given our view that these cryptocurrencies do not fulfill any of the three traditional roles of a currency: they are neither a medium of exchange, nor a unit of measurement, nor a store of value.”

According to the report, Goldman’s belief that “cryptocurrencies would not retain their value in their current incarnation” has “borne out much sooner” than they expected.

As of July 2018, Bitcoin, the largest cryptocurrency (by market cap) has lost 70% of its value as compared to the previous price boom in December last year, when it jumped up to $20,000. At the time of writing the cryptocurrency is trading at $6,391.44, according to CoinMarketCap.

The mid-year report further seconds the full-year outlook released by Goldman in January, which mentioned that the Bitcoin price boom has “dwarfed” the price action seen during the dot-com bubble.

Universal Bank of Switzerland, the second largest bank in the world, also commented on Bitcoin’s shortcoming to act as a currency and its failure to replace the dollar. According to UBS strategist, Joni Teves, Bitcoin’s price volatility prevents it from being considered as money in any form.

The writers of the report further regarded the effect of cryptocurrencies on broader financial assets as negligible.

“Importantly, we continue to believe that such declines will not negatively impact the performance of broader financial assets because cryptocurrencies represent just 0.3% of the world’s GDP as of mid-2018. In fact, we believe that they garner far more traditional and social media attention than is warranted”

Despite the harsh comments of the wall street giant, it is reportedly looking to open a Bitcoin trading operation as reported on 3rd May 2018. Lloyd Blankfein, CEO at Goldman, also believes that Bitcoin and other currencies like it are here to stay, irrespective of the fact if he deals in them or not.