Goldman Sachs is reportedly planning to separate its cryptocurrency division and form a new company focused on developing financial products and services within blockchain ecosystems. According to a Bloomberg report on November 18, this move will allow the bank to concentrate on building new blockchain-based financial instruments.
The firm is currently in discussions with potential partners to enhance the capabilities of its platform, with a particular focus on expanding its offerings. Mathew McDermott, Goldman Sachs’ global head of digital assets, shared that the bank’s aim is to foster collaborations that will help develop innovative solutions in the blockchain space. Among the anticipated partners for the new entity is Tradeweb Markets, an established electronic trading platform.
McDermott outlined that the spinout is expected to be finalized in the next 12 to 18 months, contingent on receiving the necessary regulatory approvals. The project is still in its early planning stages. He emphasized that the new structure would be more beneficial for the market, as it would be driven by industry stakeholders rather than a single institution.
This move comes after McDermott hinted in July that Goldman Sachs would soon unveil three tokenization products in both the US and European markets. He noted that there had been a significant increase in client interest in cryptocurrencies, which prompted the bank to explore more offerings. The bank’s strategy includes creating marketplaces for tokenized real-world assets (RWAs), with a focus on the US and European debt markets, particularly targeting institutional clients.
Goldman Sachs’ new tokenization plans will operate exclusively on permissioned blockchains and are expected to distinguish themselves through faster execution times and a broader array of assets that could be used as collateral. McDermott also attributed the growing momentum in the cryptocurrency space to the rising popularity of exchange-traded funds (ETFs) for digital assets, especially following the regulatory approvals for several Bitcoin and Ether ETFs in 2024.
As of November 14, tokenized US Treasury bills and other low-risk instruments have accumulated around $2.4 billion in value, underscoring the increasing demand for these types of products. Goldman Sachs has been one of the top buyers of Bitcoin ETFs this year, highlighting its growing commitment to the crypto market.
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