Goldman Sachs CEO Says It Would Be ‘Arrogant’ To Dismiss Bitcoin

During a talk at the The Economic Club of New York, CNBC reports, Goldman Sachs CEO Lloyd Blankfein said that it would be “too arrogant” to dismiss bitcoin.

“I’m not in this school of saying… because it’s uncomfortable with me, because it’s unfamiliar, this can’t happen, that’s too arrogant.”

Blankfein says, he doesn’t own bitcoin, but compared the cryptocurrency to government-backed fiat currencies, explaining his rationale.

“If you could 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?” the Goldman Sachs CEO said.

While Wall Street has remained somewhat skeptical of bitcoin, as CNBC notes, Goldman Sachs has moved away from the conventional wisdom, and started a cryptocurrency trading desk, likely causing other investment banks to follow suit.

As the New York Times reported in May this year, some big Wall Street names have started warming up to the idea of bitcoin. For instance, the parent company of the New York Stock Exchange has been working on an online trading platform that would allow investors to buy and hold bitcoin, documents obtained by the New York Times show.

The fact that bitcoin is, effectively, being treated as stock, and not as currency, is exactly why traders and crypto-owners should be worried, Jordan Belfort says. “The Wolf of Wall Street” has famously called bitcoin a “fraud,” claiming in an appearance on CNN Money, that it is a bubble waiting to burst.

Bitcoin hit a record high price of nearly $20,000 last year, but it has since fallen bellow $7,000, according to CNBC.

Perhaps naturally, central banks have remained suspicious of bitcoin. The central bank of all central banks, the Swiss Bank for International Settlements (BIS), released its annual report last week. A portion of the 24-page document references cryptocurrency.

The bank is urging the market to “look beyond the hype,” and, according to Bloomberg, considers cryptocurrencies unstable. The BIS cited the decentralized nature of cryptocurrencies as one of the reasons the public should be vary of crypto. According to the bank of all banks, the decentralized nature of cryptocurrency is a fundamental flaw.

Furthermore, crypto mining consumes too much electricity, and cryptocurrencies are subject to manipulation and fraud, the same annual report states.

According to Investopedia‘s James E. McWhinney, the absolute lack of central authority is the real reason governments are afraid of cryptocurrency. A follower of the Austrian school of economic thought, McWhinney claims bitcoin and crypto are here to stay.