Goldman Sachs Says Hedge Fund Clients Flock to Crypto After Bitcoin ETF Approval

Updated: 25 March 2024

Disclosure

Don’t invest unless prepared to lose all the money you invest. This is a high-risk investment, you shouldn’t expect to be protected if something goes wrong.

Join Our Telegram channel to stay up to date on breaking news coverage

Goldman Sachs’ hedge fund clients are showing renewed interest in cryptocurrencies following the recent approval of spot Bitcoin ETF (exchange-traded fund) investment products.

“The recent ETF approval has triggered a resurgence of interest and activities from our clients,” said Max Minton, Asia Pacific head of digital assets, in an interview with Bloomberg News. “Many of our largest clients are active or exploring getting active in the space.”

Most Demand Is For BTC Following Bitcoin ETF Approvals

A majority of the demand is for Bitcoin following the approval of Bitcoin ETFs managed by Wall Street giants, including BlackRock and Fidelity, since Jan. 11.

Minton said that demand for Ethereum might also rise if spot Ether ETFs are approved in May. Many analysts though consider that to be increasingly unlikely, with Bloomberg Intelligence recently slashing the odds of approval by May to 25%, from 35% previously.

Goldman Sachs says clients such as hedge funds are showing renewed interest in crypto options trading this year amid the digital-asset market boom https://t.co/l13a8kGa8i

— Bloomberg (@business) March 24, 2024

Minton said a majority of the bank’s largest clients were either already active in the crypto industry or exploring it.

“It was a quieter year last year, but we’ve seen a pickup in interest from clients in onboarding, pipeline, and volume since the start of the year,” he said.

The investment bank unveiled a crypto trading desk in 2021, through which it offers cash-settled Bitcoin and Ether options trading. It also supports trading for Bitcoin and Ether futures listed on the CME.

The changing behavior of Goldman’s hedge fund clients comes as Wall Street increases its share of the cryptocurrency market.

With the Grayscale Bitcoin Trust posting steady outflows, analysts believe BlackRock is on track to being the largest institutional holder of Bitcoin within two weeks.