Here’s Why Goldman Sachs is in Love with Crypto
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Here’s Why Goldman Sachs is in Love with Crypto

After many recent investments and new offerings to clients, Goldman Sachs has sights set on the crypto industry.
Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.

As cryptocurrencies continue to expand, large financial institutions are still looking to cement their role in the evolving crypto space. With so much opportunity in digital assets, banks continue to jockey over who can best meet client crypto needs.

While many large institutions are working to become more crypto-friendly, with recent large purchases and hefty projections, Goldman Sachs seems to have big plans for virtual currencies.

Goldman Sachs is Very Bullish on Ethereum

Goldman Sachs was one of the first Wall Street giants to become crypto-friendly. Just over a month ago, Goldman became a pioneer in the wealth management industry by announcing that they will offer crypto investment opportunities to clients. Despite the offerings, at the time, the bank was still a bit reluctant about owning its own digital assets but has recently become involved with crypto in different ways.

In May, the major bank opened an entire trading desk, aiming to provide clients with exposure to digital assets. In a memo, Goldman Sachs managing partner, Rajesh Venkataramani, announced:

“I am pleased to announce the formation of the firm’s cryptocurrency trading team, which will be our centralized desk for managing cryptocurrency risk for our clients. The Crypto trading team will be a part of Global Currencies and Emerging Markets (GCEM)”

Following this announcement, many other banks began to follow suit. Now, after going deeper into crypto research, Goldman has high hopes for Ethereum, as their analysts have made predictions that ETH will surpass BTC in price in the coming years.

Just this week, Goldman Sachs announced that they will begin offering Ether options to clients. This move further displays Goldman’s dedication to meeting investor needs for different crypto investments. By offering more crypto investment devices, GS is also likely trying to hedge against the current high inflation by increasing their crypto assets.

Goldman Sachs Acquires Crypto Companies

While Goldman is not known to have directly invested in virtual currencies, the company is investing in future crypto infrastructure. Most institutional banks are developing their own internal cryptocurrency departments, but Goldman is going further, recently investing in various crypto companies.

Last week, GS provided funding for crypto start-up Block Daemon. In addition, back in early May, Goldman funded Coin Metrics, diversifying their portfolio of crypto investments. 

Further, in mid-May, a Goldman-owned company announced that they were deploying a new cryptocurrency pegged to the USD. With all of these developments, Goldman is certainly becoming a larger player in the crypto industry. As the space continues to develop, it would not be surprising to see other banks become more involved, in addition to GS making many more crypto investments.

Knowing that 47% of Millennial Millionaires Have at Least 25% of Their Wealth in Crypto, big banks must either cater to the new wave of investors or risk losing clients in the future. It seems that Goldman Sachs has recognized this and is attempting to draw in some of the crypto investors—before their competitors do.

With all of the recent developments and purchases related to digital assets, does Goldman have plans to be a major player in the future of crypto investing? Being such a large public corporation, the bank certainly has the resources to make a major impact in the virtual asset world.

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Many financial institutions are warming up to cryptocurrency. After so much recent action, do you think Goldman Sachs will emerge as a pioneer in the crypto space? Let us know in the comments.

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