Goldman Sachs CEO David Solomon says the company would consider becoming a spot market maker for Bitcoin (BTC) and Ethereum (ETH) if there is a major change in the U.S. regulatory environment. He said there is a possibility.
Speaking at a Reuters Next event in New York, Solomon acknowledged that Goldman Sachs currently cannot hold cryptocurrencies due to existing regulations. He described cryptocurrencies as an “interesting technology” and noted that interest in cryptocurrencies is increasing as investors anticipate changes in the regulatory framework.
Despite the company's continued efforts to help customers navigate the crypto space, Mr. Solomon expressed uncertainty about the future direction of U.S. regulatory policy governing digital assets.
No reputational risk
The CEO of Goldman Sachs was asked about the reputational risk associated with cryptocurrencies stemming from major scandals such as the FTX bankruptcy in 2022, and answered as follows:
“I do not associate Sam Bankman-Fried (former FTX CEO) with any digital assets. There are many people who engage in criminal activity regarding fiat currencies, but that does not create any reputational risk regarding fiat currencies. .”
Solomon noted that Goldman Sachs is focusing its reputational lens on its business partners rather than Bitcoin.
From a regulatory perspective, Goldman Sachs, as a regulated financial institution, is limited to trading with cryptocurrencies, but cryptocurrencies are available to individuals and businesses who believe in these assets as stores of value and speculative assets. They have the right to participate in the market, and Mr. Solomon “certainly'' encourages that.''
Dive into blockchain
Despite not offering spot products related to BTC or ETH, Goldman Sachs is moving deeper into blockchain technology. The company announced on November 18th, announced A spin-off platform focused solely on blockchain solutions.
The Wall Street giant said it launched the program in collaboration with “strategic partners in the industry,” but did not provide further details at the time.
This was recently announced by Matthew McDermott, Goldman Sachs' Global Head of Digital Assets. The company is said to be preparing to launch three tokenization products for some major institutional customers.
Tokenization involves creating a digital representation of a real-world asset on a blockchain. Mr McDermott said this was an important opportunity for banks as customer demand for these products was increasing.
In addition to its blockchain-related efforts, Goldman Sachs reported that it owns approximately $718 million worth of Bitcoin through physical exchange-traded funds (ETFs) in its latest 13-F form. filing Cooperation with the U.S. Securities and Exchange Commission (SEC).
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