Asset manager Goldman Sachs is looking to create a separate industry-owned digital asset company in the foreseeable future.
Background
- Goldman Sachs plans to spin-out its digital assets platform into a new company
- For context, the firm put to sea its crypto desk in 2021 and its digital asset platform in 2022
- Executives from the firm are currently in the midst of talks with potential partners
- Plans for the new company are in the early stages as of now
- However, the long-term goal is to execute the spin-out within the next 12 to 18 months
- The timeframe is subject to regulatory approvals
- Tradeweb Markets will work with Goldman to bring new commercial use cases to the digital assets platform
Why should you pay attention?
- Establishing a new, standalone company independent of Goldman Sachs and its digital assets business will help provide the future runway for digital financial services
- It also provides a fit-for-purpose, long-term solution
- The new company will allow large financial firms to create, trade, and settle financial instruments via blockchain
- Goldman Sachs is looking to foster secondary transactions in private digital-asset companies
- This will ultimately help clients — like family offices — gain liquidity
- Meanwhile, buyers will benefit from private market discounts
Who said what?
- Mathew McDermott, Goldman’s global head of Digital Assets emphasized,
“It’s in the best interest of the market to have something that is industry-owned”
- He added,
“If you are trying to build out a scalable marketplace, you want to have the right strategic participants embracing this technology. You want a number that is nimble enough to operate, driven by the commercial use cases”
Zooming out
- Typically, industry-owned digital-asset platforms help expand usage and adoption
- According to the banking team, verticals like tokenization could reap direct benefits
- In other related news, the investment bank is also working to resume its activities revolving around Bitcoin-backed lending
