Marion Laboure stressed that she sees “bitcoin’s potential to become the digital gold of the 21st century,” but warned about the volatility of the asset. She noted that most bitcoin is bought for speculation and investment rather than for use as a medium of exchange and payment.
“Just a few large purchases or sales in the market can greatly affect the balance of supply and demand. Bitcoin is too volatile to be considered a reliable means of storing wealth. And I predict it will remain ultra-volatile for the foreseeable future,” Laboure believes.
The Deutsche Bank analyst also noted a lack of regulation in the cryptocurrency industry. At the same time, while bitcoin is likely to remain the industry leader, Etherium has many more applications. For example, in decentralized finance (DeFi) and for issuing collectible tokens (NFT).
“If bitcoin is called digital gold, then Etherium should be called digital silver,” Laboure writes.
Earlier, Deutsche Bank, along with other major banks around the world, opposed the Basel rules on cryptocurrency investments. Such rules exclude the possibility of banks’ participation in this activity.