Analysts at banking behemoth Goldman Sachs believe the recent crypto crash will have little impact on U.S. households.
Michael S. Derby, a special reporter from Wall Street Journal, comun this information through a Twitter screenshot on May 19. The bank’s analysts, led by Jan Hatzius, estimated that U.S. households hold approximately one-third of the global crypto market.
Goldman Sachs: Cryptocurrency bloodbath should have little impact on overall U.S. financial conditions and spending ability. pic.twitter.com/LKibj32CSv
— Michael S. Derby (@michaelsderby) 19 Mai, 2022
Explaining why they don’t believe the crash will have a massive impact on U.S. households, the analysts said the recent decline is very small relative to the net worth of U.S. households. Additionally, Goldman Sachs’ analysts do not expect the spending habits of Americans to change.
Young American men were most likely to suffer from the crash
The analysts further predicted that there would be limited scope for an increase in labor force participation due to the decline in crypto prices. According to them, this is because crypto holdings form a small share of household wealth.
Additionally, the labor force participation rate of young men, which was the most susceptible demographic, has already fully recovered to its pre-pandemic level.
While Hatzius and his team believe crypto alone will not alter the spending habits of Americans, they said,
„Luați împreună, continuăm să ne așteptăm ca condițiile financiare mai stricte să ducă la o încetinire bruscă a creșterii și a cheltuielilor în acest an, iar scăderea averii gospodăriilor ar putea foarte bine să stimuleze unii lucrători care au părăsit piața muncii în timpul pandemiei să revină. Cu toate acestea, orice impact incremental al recentelor scăderi ale prețurilor criptomonedelor va fi probabil modest.”
This news comes as the crypto market continues posting a mediocre performance following the colaps of EarthUSD (UST) Şi Pământ (LUNA). At the time of writing, Bitcoin (BTC), the leading crypto by capitalization, is trading at $29,332.22 after losing 3.04% over the past 24 hours.
The altcoin market is also performing poorly, with Ethereum (ETH) changing hands at $1,968.09 after losing 2.11% in the day.
Source: https://cryptoslate.com/goldman-sachs-says-the-crypto-crash-will-have-a-small-impact-on-the-u-s/