Goldman Sachs CFO: Crypto Desk Reports are False
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Main page News, Bitcoin, Banking, Goldman Sachs, Cryptocurrency
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Sept. 7, 2018
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At the TechCrunch Disrupt Conference in San Francisco, Martin Chavez, CFO of Goldman Sachs, said that recent reports that the company is abandoning its plans to launch a desk for crypto trading are fake, CNBC reported on September 6.

"I never thought I would hear myself use this term but I really have to describe that news as fake news," he said.

Rumors that by the end of 2018 Goldman Sachs planned to create a crypto unit, were spread by Bloomberg in December 2017. Back then this news was received with enthusiasm: the largest investment bank was setting its way to crypto. It couldn’t be any cooler!

Later, on September 5, Business Insider referred to anonymous sources saying that the bank refused to launch crypto trading because of the uncertain position of financial regulators. Chavez calls this news fake because there has been no official statement about trading crypto coming from the Goldman Sachs in the first place.

He notes that when the company was talking about exploring digital assets, they meant literally doing research.

Chavez thinks that it was probably a reason for someone to start fantasizing about Goldman Sachs’ activities in this area and decide that the bank will trade bitcoin, “but it’s not here yet"- he said.

Further in the conversation, Chavez begins using unconventional concepts like "physical bitcoin". The meaning behind it is that Goldman Sachs carries out clearing of cryptocurrency derivatives, namely bitcoin-futures. Therefore, the adjective "physical" is used by the bank’s CFO to emphasize the difference between a derivative financial instrument and regular bitcoin.

So, before starting to trade crypto, the company must first solve the issue of storing cryptocurrency. "Physical bitcoin is something tremendously interesting, and tremendously challenging", Chavez said. But the bank has still no reliable custodial bitcoin solution for institutional investors.

"We're interested in having that exist and it's a long road", he stated.

WHY IS IT IMPORTANT?

  • The price of Bitcoin and the rest of the market fell headlong following the news that Goldman Sachs refuses to create a trading desk. The total cryptocurrency market capitalization dropped by $12 billion in an hour.
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