Goldman Sachs has become the first United States of America bank to trade in Bitcoin futures after entering the market in partnership with Mike Novogratz’s Galaxy Digital.
It also marks the first time Goldman Sachs would use a digital asset firm as a counterparty since the investment bank set up its cryptocurrency desk last month.
This is another big feat for Bitcoin and the entire crypto industry as the move is one that gives other banks cover to begin doing so as well, said Vanderwilt, a former Goldman partner.
Goldman Sachs has said in a memo it will sign on more liquidity providers beyond Galaxy Digital to help expand its offering.
“Our goal is to equip our clients with best-execution pricing and secure access to the assets they want to trade,” Max Minton, head of digital assets for Goldman’s Asia-Pacific region, said in a statement. “In 2021, this now includes crypto, and we are pleased to have found a partner with a broad range of liquidity venues and differentiated derivatives capabilities spanning the cryptocurrency ecosystem.”
Vanderwilt said that Goldman Sachs relies on Galaxy for access to crypto as banks can’t deal in Bitcoin directly due to high regulation.
How Goldman Sachs Bitcoin futures trading will help crypto space
Support of banks for crypto is very crucial, especially for Bitcoin adoption, as it provides a trusted mechanism to invest and trade.
According to a former Goldman Sachs partner who joined Galaxy last year, Damien Vanderwilt, more and more institutional involvement will make Bitcoin less volatile and make it safer for retail investors.
The step by Goldman is expected to be followed by all other major banks as clients demand Bitcoin-based investment options more than ever.
It is safe to say that Bitcoin has now joined the list of assets being traded on wall street as more institutions like hedge funds, Venture capitalist firms can take a position on Bitcoin.