In a sudden change of sentiment, Goldman Sachs has started to entertain the idea of having a Bitcoin strategy. While plenty of exchanges and ETFs have taken steps to get involved in this burgeoning sector, Goldman Sachs is the first major bank to consider opening up a market on Wall Street.
A CHANGE IN THE INSTITUTIONAL TIDE
Only a few months ago, Goldman Sachs was leery of the cryptocurrency market and its flagship star, Bitcoin. In October, the firm’s CEO, Lloyd Blankfein, tweeted that Goldman Sachs was still undecided on how it should approach the young and volatile assets. Come November, however, Blankfein noted that the banking giant was warming up to the idea of embracing the trend.
Now, it appears as though Goldman Sachs is getting ready to grab the cryptocurrency bull by the horns. As reported by Bloomberg, the banking firm has begun forming a cryptocurrency trading desk, with the purpose of opening up its own markets for the digital assets. After working through security and storage logistics, it hopes to have these markets live by June of 2018.
This development makes Goldman Sachs the first mover on Wall Street to consider subsuming crypto into legacy markets. The bank has yet to decide which of its divisions will oversee the new markets, but it’s considering handing over responsibility to its currencies and commodities unit’s systematic trading mechanism. The latter conducts electronic transactions, so it seems like a logical fit.
THE RISE OF NEW ASSET CLASSES
This past month, Goldman Sachs has been one of many institutions that have cleared trades on CBOE’s Bitcoin futures market. It appears as though these futures have opened the floodgates for a variety of crypto-specific assets, and Goldman Sachs is looking to fill market demand.
“In response to client interest in digital currencies, we are exploring how best to serve them,” Goldman Sachs spokesman Michael DuVally said in a statement.
As we delve into the new year, legacy financial institutions will likely continue to get their hands on Bitcoin and its crypto posse. With the looming possibility of ETFs and even more futures contracts entering the scene, expect plenty of players to take up crypto’s mantle. Even amidst the ongoing mass correction, there’s plenty in the way of anticipation going into 2018.
This article was first published by Colin Harper at The Merkle