Most financial institutions have tried to stay away from the cryptocurrency market, yet with Goldman Sachs moving ahead and setting up what looks to be first bitcoin trading desk from a Wall Street bank, it’s likely that other banks will follow.
That’s according to Spencer Bogart, a blockchain venture capitalist and partner at Blockchain Capital.
Other Banks to Follow?
Now, however, with one Wall Street bank dipping their toes in the cryptocurrency market, Bogart believes that other banks will follow as they look to see what Goldman Sachs is doing. In an interview with CNBC’s ‘Fast Money,’ he said:
“Most of these banks have heard about the numbers or seen the numbers that companies like Coinbase and Binance are putting up. There’s a real risk that some of those companies could overtake some of Wall Street’s biggest banks if they don’t get in the market.”
Interestingly, one bank that isn’t planning to follow in Goldman Sachs’ footsteps is British multinational investment bank Barclays.
This week, it was reported that Jes Staley, CEO of Barclays, had ruled out the launch of their own cryptocurrency trading desk for the moment. Earlier reports suggested that Barclays was carrying out an initial assessment to gauge client interest in the bank opening a cryptocurrency trading desk. According to Staley, though, cryptocurrencies like bitcoin present a ‘real challenge’ for them. The British bank has also compared the spread of the cryptocurrency market to that of an infectious disease.
Of course, with the market too large to ignore it, according to Bogart, it remains to be seen how much longer Barclays will keep up its position of not getting involved with the cryptocurrency market.
Earlier this week, it was reported that Goldman Sachs was taking steps to use its own money to trade with clients in a number of contracts linked to the price of bitcoin, reported The New York Times. Notably, though, while the Wall Street bank won’t be buying or selling the coins to begin with, a team at the bank is thinking about going in that direction if it can get regulatory approval. Goldman Sachs has also made its first hire in its cryptocurrency markets unit, signalling its seriousness in helping clients to invest in digital currencies.
Such a move from the bank highlights how far the market has come considering a few years ago the idea of Goldman Sachs, or any other bank, toying with the idea of trading bitcoin would have been an absurd notion.