David Solomon, CEO of Goldman Sachs, predicted a “big shift” in the way the US government regulates Bitcoin and other cryptocurrencies, relative to financial institutions.
In an interview with TBEN today, Solomon was asked about the steps the banking giant is taking to embrace Bitcoin. The CEO kept his cards close to his chest, but said the bank was keeping a close eye on digital currencies, amid growing demand for crypto exposure from its clients:
“We continue to think about digital currency and the digitization of money in a very proactive way, and in that context we are engaged with our customers and we are looking at all of this through the centrality of ‘what our customers have – do they need? “.”
Current US restrictions on financial institutions prohibit them from offering direct exposure to volatile and risky asset classes such as Bitcoin. Due to these regulations, which consider crypto a high risk asset class, financial institutions can only offer crypto exposure in the form of custody positions of digital assets such as securities or ETFs. .
However, Solomon noted that the crypto space is changing and predicts that this will change over time, but did not want to speculate on what this actually means:
“I think there will be a big evolution. As for how that will evolve in the years to come, we operate according to the rules that we have, I will not speculate on the destination of the rules for regulated financial institutions, but we will continue to find ways to serve our customers at as we evolve. before.”
The bank announced last week that Goldman’s private wealth management division is set to offer Bitcoin exposure to larger clients with portfolios of $ 25 million or more. A “full spectrum” of investment options in Bitcoin and other cryptocurrencies is expected to launch in the second quarter of this year.
Former SEC Chairman Jay Clayton also noted recently that the regulatory environment surrounding crypto needs to be overhauled, using terminology similar to Solomon’s:
“Where digital assets land at the end of the day […] will be driven in part by regulation – both national and international – and I speak as a citizen now, that regulation will come into this area both directly and indirectly, whether by the way they are held in banks , security accounts, taxation and the like. We will see this regulatory environment evolve. “
The 2021 Bitcoin bull market saw Goldman Sachs reopen its cryptocurrency trading desk in March, after the company initially put it in place during the 2017 bullrun when Bitcoin hit $ 20,000 and then broke down. is overwritten. The bank also filed for an ETF including bitcoin exposure on March 26.