Former Goldman Sachs employee explains why Wall Street is against Bitcoin and cryptocurrencies.
Although Bitcoin has more value for many of the big companies every day, traditional companies, there are many investors and capital firms on Wall Street that They still distrust Bitcoin.
On this topic, John Harr, former member of the Asset Management division of Goldman Sachs, published an article in which he explains his perception of the opinion that large Wall Street firms have on Bitcoin, traditional money and the economy in general.
In this article, the former Goldman Sachs employee exposes the Reasons why traditional finance firms oppose or do not appreciate the potential of Bitcoin as global money.
Bitcoin is not understood because the history of money is unknown
One of the main points that Harr makes in his article is the great ignorance of the majority of workers in the financial industry about the history of money“Virtually no one” has spent time understanding the history or fundamentals of traditional money, he explains.
In this sense, they do not understand the characteristics that made gold the dominant form of money throughout history. These characteristics are:
- Durability.
- Divisibility.
- Easy to recognize.
- Portability.
- Shortage.
For Harr, Bitcoin has these same characteristics, only much more enhanced. Therefore, since most of Wall Street is unaware of why gold is valuable, they are unable to recognize the true value of Bitcoin.
“To the extent that those working in traditional finance have any opinion on the history or fundamentals of money, it is almost entirely up to them.” shaped by Keynesian economics and perhaps modern monetary theory (MMT) in more recent years,” he notes in his article.
Both Keynesian theory and MMT advocate a centralized control of a nation's money supply, in order to manage the economy.
However, Bitcoin is a currency that no one can control, which has caused major central bank managers to be against this crypto asset.
Added to this problem is the Lack of training or understanding in Bitcoin, which has led Wall Street to take tough positions against the cryptocurrency in which they simply repeat the objections expressed in the media.
Wall Street and the lack of perspective
The former Goldman Sachs employee also noted that Wall Street has traditionally been little willing to adopt new technologies and they usually follow the established rules.
On the other hand, the world of traditional finance is accustomed to working with stable currencies and reliable property rights, so they are less predisposed to adopt Bitcoin than in countries with less stability such as Argentina, Turkey, Venezuela, Niger and others, where adoption is much higher.
In conclusion, Harr explains that those who have come to a position on Bitcoin and cryptocurrencies have not done so through a detailed study or understanding what cryptocurrency means.
On the other hand, he also explains that many of those who oppose it do so because Bitcoin offers people a way to store wealth without having to “invest” money, which means less business for investment firms.
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