Clients Taken On By Banking Firm For Trading Bitcoin

Published 5 years ago on October 31, 2018

Clients Taken On By Banking Firm For Trading Bitcoin

Crypto fanatics have been on the edge of their seats waiting for the banking firm, Goldman Sachs to make an official move on the firmâ€™s goal to integrate Bitcoin derivatives. The rumours have been stirring since October last year when the Wall Street Journal first reported the investment banking giant might intentions of launching a Bitcoin trading operation. The latest news is that the banking firm is said to have taken on a small number of clients to actively trade a Bitcoin derivatives product. Goldman Sachs has been looking into ways to custody digital currency for its clients. It was reported last week that the investment bank was exploring ways for the creation of an Ethereum product to offer its customers, however, according to sources, this isnâ€™t an accurate statement. It wasnâ€™t clear if the organisation was even building such a product because futures for Ether, do not trade on any regulated exchange in the United States. Bitcoin derivatives are available on some regulated trading platforms in the United States, including CME Chicago Board Options Exchanges. It was also revealed that "the companyâ€™s clients arenâ€™t necessarily looking for new products. But that doesnâ€™t mean they arenâ€™t interested in the market." As said the International Business Times:

â€œDerivatives are contracts between two parties to fix the price of an underlying asset (cryptocurrency, in this case) over a period of time or for a future transaction. The user of these contracts is bound to purchase the underlying asset at a fixed price and on a specific date, and the seller commits to sell. Bitcoin derivatives would let investors manage risk, and make it safer to hold and trade the cryptocurrency.â€

Essentially, this will make Bitcoin more accessible to institutional businesses and investors as the risk factor is removed to a certain extent. Back in May, a Goldman Sachs executive, Rana Yared was quoted saying:

â€œBitcoin resonates with us when a client says, â€˜I want to hold bitcoin or bitcoin futures because I think it is an alternate store of value. Goldman will begin using its own money to trade bitcoin futures contracts on behalf of clients.â€

This led to several people thinking that investment bank already had confirmed the plan to start Bitcoin derivatives. What are your thoughts? Let us know what you think down below in the comments!

Adrian Barkley

Adrian is an avid reader who first stumbled across Crypto after reading 'The Basics of Bitcoins and Blockchains' by Antony Lewis in 2018. Since then, Adrian has immersed himself within the industry, and has a real interest in Enterprise Blockchain solutions.