The chief financial officer of Goldman Sachs, Martin Chavez, has addressed recent reports that the US bank is abandoning plans to open a cryptocurrency trading desk, CNBC has reported.
A report from Business Insider on Wednesday triggered a massive sell-off that led to steep price declines across the crypto market, with some digital coins hitting fresh 2018 lows. However, Chavez said yesterday at the TechCrunch Disrupt Conference in San Francisco that the rumours were unfounded.
"I never thought I would hear myself use this term but I really have to describe that news as fake news," Chavez said as quoted by CNBC. He further explained that the company’s exploration of the crypto space was meant to be “evolving over time”, indicating that opening a crypto trading desk had never been in the bank’s short term plans.
“Maybe someone who was thinking about our activities here got very excited that we would be making markets as principal and physical bitcoin, and as they got into it they realized part of the evolution but its not here yet.”
He then revealed that the company was working on a derivative product, which had been requested by clients.
"The next stage of the exploration is what we call non-deliverable forwards, these are over the counter derivatives, they're settled in U.S. dollars and the reference price is the bitcoin-U.S. dollar price established by a set of exchanges," Chavez said.
Describing physical Bitcoin as “something tremendously interesting, and tremendously challenging”, Goldman’s CFO emphasised on the need of a safe custody solution for the cryptocurrency.
“From the perspective of custody, we don't yet see an institutional-grade custodial solution for bitcoin, we're interested in having that exist and it's a long road,” he said.
The Business Insider report suggested that Goldman was working on building a custody solution to target institutional investors.