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The recent cryptocurrency market crash does not seem to be affecting the investment decisions made by leading institutional players. Goldman Sachs, one of the leading investment bankers in the US, has continued with plans to expand its Ethereum trading options.
Goldman Sachs executes first Ethereum derivative trade
Goldman Sachs was one of the largest institutions in the US that endorsed cryptocurrency investments. A recent development by this banking giant was that it started trading a derivative asset linked to Ethereum (ETH).
This Ethereum derivative product aims to offer investors indirect exposure to Ether. The launch of this product also comes amid a notable recession in the market, where Ether has declined to the $1100 level while its dominance in the market has continued to fall. The global cryptocurrency market cap declined below $1 trillion following the crash.
A Bloomberg report said that the counterparty involved in this Ether trade was Marex Financial, a financial services firm based in London. The product could be off to a rough start given the factors triggering the market turmoil, such as the rising inflation rates, increased interest rates, and the recent fiasco with the Celsius Network.
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However, the recent launch of this product by Goldman sheds a positive light on the future of the crypto industry. Institutional players have accounted for a large share of the trading volumes over the past year. Goldman Sachs has been at the top of the list of institutions showing interest in the crypto industry.
The former CEO of the investment bank said that the cryptocurrency market was “happening”. Before this, the executive used to be a major skeptic of the cryptocurrency industry.
Goldman Sachs diversifies to Ether
Goldman Sachs seems to be diversifying its investment ideas toward cryptocurrencies other than Bitcoin. In the past, the investment bank mainly focused on Bitcoin-related derivatives after crypto services were restarted in July last year. In March, Goldman Sachs became the leading US bank to provide a Bitcoin OTC options trade.
In April, Goldman Sachs announced it would offer Ether trading options settled in cash. It has previously predicted that Ether could surpass Bitcoin as a store of value. Goldman Sachs had predicted that Ether would reach $8000 by the end of 2021, but this failed to happen.
In February 2020, Goldman Sachs partnered with Citigroup to experiment with a blockchain-based equity swap. This was similar to the swaps facilitated by Ethereum.
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