Goldman Sachs falls back in love with crypto! Goldman Sachs announces crypto ambitions – at least according to David Solomon. What do you think of that?
Speaking to Les Echos, Solomon told the French newspaper that Goldman Sachs is “absolutely” considering its own cryptocurrency. Playing catch up to rival JPMorgan, Solomon says that you should assume all major investment banks are considering entering the hot market of crypto.
“Absolutely! Many people are looking in this direction. But it is too early to say which platform will prevail…Assume that all major financial institutions around the world are looking at the potential of “tokenization,” “stable wedge” and frictionless payments.”
Solomon was also asked about the Libra Project, Facebook’s consortium to enter into the cryptocurrency market. When asked if Goldman Sachs is talking with Facebook about the project, he remained coy. While he could neither confirm nor deny if Goldman has been in talks with Facebook, he admitted that blockchain and crypto currencies have disruptive potential – it can no longer be denied.
“I can not comment on any discussions we may have with our clients. What I can tell you is that I find the principle interesting. We do extensive research on the concept of “tokenization,” the potential of which we believe, and which designates the creation through the blockchain of a stable digital currency based on a basket of real currencies that can move money across borders and without friction. This is the direction in which the payment system will go.”
Goldman Sachs is widely remembered in Crypto for their constant flip-flopping. In April of this year, Solomon testified before Congress that his firm never had concrete plans to launch a crypto trading desk.
His strong denial contradicted rumors dating back to the last bitcoin bull run in December of 2017. These rumors exploded at the height of the bull market when Bitcoin was fast approaching $20,000.
It’s also not surprising to see the CEO of one of the more powerful investment banks in the world testifying the way he did in front of the US Congress. Lawmakers around the world are split about the role that crypto should play in the global financial markets.
David Solomon said that governments are closely watching this growing industry. He also believes that regulations are coming. He also noted that he doesn’t believe cryptocurrencies pose an existential threat to investment banks – but investment banks must evolve to adapt to whatever changes cryptocurrencies will inevitably bring.
“I do not think banks will disappear because of [cryptocurrencies]. Admittedly, they will have to evolve, because the trades linked to the payment flows will become less profitable. There are many other reasons why banks must remain innovative, otherwise they will disappear.”
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