Major Wall Street investment bank, Goldman Sachs has finally made known its stance on opening a cryptocurrency trading desk.
The bank clarifies that such plans are not a priority for the foreseeable future, but rather it will be focusing its energy on a custody product for crypto that would better service large institutional clients.
Strong Rumours In The Past
This latest development as reported on Business Insider is contrary to popular expectations. There have been protracted rumours of significant progress within the company towards the establishment of a direct crypto trading desk over the past couple of months. The year 2017 recorded some significant activities that pointed towards the realization of such plans. Developments at the time included the bank’s hiring of seasoned cryptocurrency trader Justin Schmidt, a move that sparked even more suggestions across the crypto ecosystem in support of the speculation.
Despite the uncertainty at the time in line with the bank’s commitment towards launching a crypto trading desk, comments from within and other respected sources strongly suggested some relevant interest on the subject matter. This includes a comment from a spokeswoman from the bank that on how they are working to meet the demands of their clients who have expressed interest in cryptocurrencies.
Setting The Records Straight
However, in January 2018 some level of clarity about the developments in this area began to surface. Comments from the bank’s chief executive Lloyd Blankfein introduced some level of clarity to the ways and extent of their involvement in the cryptocurrency market. In an interview with CNBC, Blankfein explained that the role being played by his bank was simply to clear futures in bitcoin for some of their futures clients. He distanced the institution form a principle bitcoin business that involved them going long or short, thereby involved in market making.
The recent report on Business Insider is finally expected to lay to rest, at least for the time being the rumours and speculations on the role of Goldman Sachs in the crypto market. According to the report, the unclear nature of the regulatory framework surrounding cryptocurrencies is among the key reasons why the bank will not get directly involved in the cryptocurrency market just yet.
A Shadow Of An ETF
Goldman’s priority at the moment focuses around projects such as a custody product for crypto, a service that would be ideal for large institutional clients longing to get into the cryptocurrency market. This is aimed at providing a comfortable platform for these huge investors that will be highly interested in the safety of their funds, considering the volatile nature of the crypto market as it is today.
This isn’t very far from the prevailing ideology surrounding the introduction of an ETF for bitcoin and cryptocurrencies. Whether there is any synchronization between the decision of Goldman and SEC’s reluctance so far in the approval of a bitcoin ETF remains unknown to the public. However, the open-ended colouration of these decisions sustain the typical uncertainty that the cryptocurrency ecosystem has become used to.
Featured image from Shutterstock.
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