Bitcoin‘s application as a form of real money is likely easier said than done, according to a new report from Goldman Sachs.

In a report exploring the cryptocurrency as money in the classic sense, the firm said that while bitcoin could hypothetically thrive as we see the dollar, yen or euro, it would likely face a whole host of fundamental challenges.

While Goldman Sachs found some evidence that demand for cryptocurrencies comes from regions with “currency instability and/or capital controls,” other data point to pure retail speculation. Of course, bitcoin in the past year has been widely seen as a speculative market as the cryptocurrency soared quadruple digits in 2017 alone.

“In practice, Bitcoin and other digital currencies face significant practical hurdles to wider adoption—including potential government regulation and excessive volatility. So could Bitcoin succeed as a form of money? In theory, yes, if it proves capable of facilitating transactions at a low cost and/or providing better risk-adjusted returns for portfolios. In practice, however, the bar looks high. The currencies of most developed market economies already deliver these monetary services quite well. And if blockchain technologies go mainstream, as seems likely, the bar will look even higher,” wrote a team led by Zach Pandl, co-head of foreign exchange and emerging markets strategy, in a note published Wednesday.

“That said, Bitcoin (and cryptocurrencies more generally) may offer viable alternatives in countries and corners of the financial system where the traditional services of money are inadequately supplied,” Pandl wrote. He added in an email to CNBC on Thursday that cryptocurrencies will need to “clear many regulatory hurdles before gaining broader acceptance.”

The report was published a day prior to news that South Korea could be readying a bill cracking down on cryptocurrency trading in the country, perhaps an outright ban. The news sent bitcoin and myriad cryptocurrency peers like ethereum tumbling overnight.

Bitcoin pared some of its losses by midday Thursday, however, trading just above $14,000 per coin on Coinbase.

It would appear the cryptocurrency universe’s reaction to the news in and of itself confirms a theme Pandl and his co-author, Charles P. Himmelberg, highlighted in their report: that while cryptocurrencies could serve as attractive hedges against inflation or stores of value due to their lack of central bank backing, the group’s stunning volatility makes them ill-suited as money substitutes.

“The recent fluctuations in Bitcoin and its relatives suggest they are much too volatile to serve as money. Volatility would likely need to come down dramatically (either naturally or through the widespread adoption of cryptocurrencies designed to better stabilize purchasing power via supply adjustments) before we see broader adoption,” the team wrote.

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