Goldman Sachs To Launch A Custodial Service To Store Bitcoin

Aug 7, 2018 at 04:33 Update Date :Aug 7, 2018 at 04:33 UTC

Goldman Sachs, one of the largest investment banks in the world right now, might soon start bringing altcoins into its investment operations.

According to reports, the bank is now developing a crypto custody service. This new move will now enable cryptocurrency funds to use the Goldman Sachs custodial services, which means now they have institutional backing to manage their assets. This move will link all the assets to security, insurance, and several other investment systems, which had so long been impossible.

Such guarantees that would help secure assets have not been very viable in as volatile and unregulated a market as this, but this move by Goldman Sachs could change that. The fact that they have been sitting together to discuss this move shows that the demand for crypto-based services is rising. If the plans materialize, even sceptics and other investors might want to partake in the market.

A spokesperson from Goldman Sachs commented:

“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 crypto-market’s credibility would certainly receive a boost if the plan materializes. The custody service, and the protection it brings to customers, could make regulators consider legitimising crypto indexes and hedge funds. Prime-brokerage services and other related investment services could also be potentially opened up for action.

This new service would definitely be a welcome addition to the investment instruments present in the market. The only such proper instruments available in the industry right now are the Cboe and the CME Bitcoin futures contracts, both of which were launched just last year. For over a year, there have been struggles for the approval of a Bitcoin ETF with the SEC – a struggle which still stands on a deadlock despite renewed efforts.

On the other hand, several financial institutions have been getting more and more involved into the market without letting their digital assets be absorbed into the traditional procedures. The ICE recently revealed Bakkt, its own crypto payment ecosystem and platform, just a mere 3 months after the firm announced its development. Earlier this month, Northern Trust Financial also said that it would extend administrative services to a selected few crypto-invested hedge funds; however, these services would not include the custody of assets directly like Goldman Sachs does.

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