Business 8 August 2018Erik Gibbs
Goldman Sachs plans crypto custody solution
In a world where most financial institutions are trying to suppress cryptocurrencies, a few can see the bigger picture and could help to have a major impact in its acceptance on a global level. One of these is Goldman Sachs, which has already started testing the crypto waters, sticking its toes into the deep end. Now, the financial giant is reportedly ready to take the next step and is said to be preparing a crypto custody service for its clients.
In a report by Bloomberg, several unidentified sources familiar with the company’s operations told the news outlet that Goldman Sachs is planning to “offer [clients] custody for crypto funds,” even though it still is undecided about its overall plans for the space.
The company announced in May that it’s considering BTC futures trading, and is apparently considering several other digital asset products “in response to client interest.” A spokesperson for the firm said, “In response to client interest in various digital products we are exploring how best to serve them in this space…At this point we have not reached a conclusion on the scope of our digital asset offering.”
The unidentified source who spoke to Bloomberg indicated that the “digital products” were specifically related to cryptocurrency custody. They further indicated that the custody service could be a stepping stone toward other products, including services targeting prime brokerage applications.
If the company does move forward as indicated, it could potentially have significant impact on the crypto space. Having a global financial giant such as Goldman Sachs providing crypto-related services would go a long way to strengthen consumer confidence and could also open the doors at other financial companies, determined not to miss out on the action.
Indeed, the move by Goldman Sachs could be tied to concerns over missing out. Last week, the Intercontinental Exchange (ICE), which owns the NYSE, announced the launch of a regulated crypto “ecosystem.” That launch is scheduled to take place in November and stems from a partnership between ICE, Microsoft, Starbucks and a few other companies.
Despite the apparent gradual acceptance of the crypto industry at Goldman Sachs, it’s obvious that not everyone is onboard. The company’s Investment Strategy Group recently published a report that predicts a decline in crypto pricing across all markets, adding that crypto “will not retain value in [its] current incarnation.”
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.
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