Goldman Sachs Wealth Management Chief Dismisses Crypto as Speculation, Compares It to Tulip Mania

Goldman Sachs Wealth Management's CIO, Sharmin Mossavar-Rahmani, reportedly dismisses cryptocurrency as a speculative asset rather than a genuine investment class due to its elusive valuation and lack of earnings, cash flow, or dividends.

Goldman Sachs Wealth Management Chief Investment Officer Dismisses Crypto as Speculation, Compares it to Tulip Mania

Sharmin Mossavar-Rahmani, the chief investment officer of Goldman Sachs Wealth Management, has cast aspersions on the burgeoning cryptocurrency market, dismissing it as a mere speculative endeavor devoid of fundamental value. In an interview with The Wall Street Journal, Mossavar-Rahmani expressed her skepticism towards cryptocurrencies, arguing that their inherent volatility and lack of intrinsic worth undermine their credibility as legitimate investment assets.

"We're not believers in crypto," she asserted. "If you cannot assign a value, then how can you be bullish or bearish?"

Her stance echoes the reservations held by some financial advisors who question the wisdom of incorporating cryptocurrencies into investment portfolios. Despite the recent surge in Bitcoin's value, which propelled it to record highs earlier this year, Mossavar-Rahmani remains unmoved, equating the current enthusiasm for crypto to the infamous tulip mania that gripped the Netherlands in the 17th century.

"It's like the tulip mania," she remarked. "The asset is only worth as much as someone else is willing to pay for it."

Her clients, however, appear to share her skepticism, with Mossavar-Rahmani reporting minimal inquiries regarding crypto investments.

In addition to her doubts about crypto's intrinsic value, Mossavar-Rahmani also raised concerns about its potential involvement in nefarious activities. She cited the recent conviction of the operator of Bitcoin Fog, a crypto mixing service that facilitated the laundering of illicit funds, as a cautionary tale.

"Cryptocurrencies are still primarily used to facilitate crime," she asserted. "We don't want to get involved with that."

Mossavar-Rahmani's perspective runs counter to the growing adoption of cryptocurrencies by institutional investors and financial giants. BlackRock and Fidelity, among others, have launched Bitcoin exchange-traded funds (ETFs) in recent months, signaling their willingness to embrace the nascent asset class.

Despite these developments, Mossavar-Rahmani remains steadfast in her skepticism. She believes that cryptocurrencies lack the fundamental characteristics necessary to be considered viable investments and that their speculative nature renders them unsuitable for inclusion in diversified portfolios.