Goldman Sachs, one of the world’s biggest bank with total assets of nearly $1 trillion, is apparently considering a new bitcoin trading operation.
The plans are at an early stage and the bank might not go ahead, but there appears to be considerable interest in digital currencies from Goldman Sachs’ clients.
“In response to client interest in digital currencies we are exploring how best to serve them in this space,” a Goldman spokeswoman told WSJ.
Goldman’s involvement in bitcoin trading aims to serve institutional investors with a potential team of traders and salespeople formed for market making in a similar way they trade fiat currencies or stock shares.
The bank’s currency-trading division and its strategic investment group would both be involved in bitcoin trading, suggesting they view bitcoin more as a currency than as a commodity.
A view that is supported by bitcoin’s wide use for payments as shown by an announcement from BitPay today that they are on track to handle $1 billion worth of bitcoin payments this year, a very first.
With demand significantly increasing in 2017, propelling bitcoin to a $70 billion market cap, far higher than many stock traded companies or web 2 social networks such as Twitter.
While other digital currencies, such as ethereum, are now providing some lucrative services traditionally reserved for banks, such as IPOs, which many start-ups might pass in favor of ICOs, not least because they are seen to be far more open and democratic.
The banks involvement, therefore, might be due to market pressures and a need to keep up with changing times and demands as institutional investors seemingly start moving into this space.
But the bank is very controversial with the public. They received $10 billion in taxpayers money in 2008, for example, so needing a bailout after making some risky bets in the housing market.
With the bank attracting prime focus in the aftermath due to speculating on corn which led to rising food prices and even riots in some developing countries.
Wall Street’s involvement in bitcoin trading, therefore, might be seen as ironic by some. While others might consider bitcoin’s genius to be its very nature of a peaceful technological revolution, which persuades by appealing to self interest.