Big Things Coming? Goldman Sachs May Soon Launch Crypto Trading Desk
In a bid to accentuate client interests in Bitcoin trading and other cryptocurrencies, Goldman Sachs has hired a crypto trader to run a dedicated trading desk.
Last week, Justin Schmidt joined Goldman Sach’s securities division as VP and chairperson of digital asset markets. Previously, he was a senior VP at Seven Eight Capital and a portfolio manager at LMR Partners before that.
It is since December 2017 that rumors have been afloat in the industry about Goldman’s plan to launch a crypto trading desk. However, until now, Goldman Sachs has continually denied these stories.
Tiffany Galvin, a spokeswoman for Goldman Sachs, said:
“In response to client interest in various digital products, we are exploring how best to serve them in the space. At this point, we have not reached a conclusion on the scope of our digital asset offering.”
As opposed to its role as a market maker in the traditional finance sector, Goldman’s digital asset involvement is merely to help its interested customers. They would offer exposure to bitcoin through the Bitcoin Futures contracts offered on the Cboe Global Market and CME Group exchange.
Rising Regulatory And Institutional Interest Signals Big Things Ahead
Recently, it has been observed that there’s a high level of regulatory interest in crypto assets. Although it is still not clear how to regulate the crypto-currencies and digital assets listed on exchanges, the Securities and Exchange Commission (SEC) has temporarily decided to treat them the same way as other securities.
In March 2018, the SEC issued a statement saying that it’s looking to “apply securities laws to cryptocurrency exchanges and wallets.”
Barclays in the United Kingdom said in the second week of April that it has tentative plans to monitor developments in the cryptocurrency space similarly and analyzing clients’ interests in a crypto trading desk. However, it has no firm plans to do so.
According to Matt Levine, a bank can trade any financial “stuff” which its clients would demand.
“If the sorts of customers who are banks’ customers want to trade a thing, then that thing becomes a financial thing, and so the banks had better start helping them trade it.”
It is expected that more and more banks will start gauging the ability to provide clients access to crypto trading, but without direct involvement – at least until client expectation of crypto trading reaches a mass level or the industry gets a more precise from regulators.