30s Summary

Goldman Sachs is planning to form a new company focused on creating and trading financial products on blockchain. In collaboration with digital trading platform Tradeweb Markets, and pending necessary approvals, the firm plans to roll out the platform within the next 18 months. Meanwhile, Goldman Sachs is preparing to launch three tokenisation products later this year in response to increased client interest in cryptocurrencies. The goal of the venture is to create marketplaces for tokenised real-world assets in the US and Europe which will be pitched to financial institutions.

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Goldman Sachs is planning to form a new company that’s all about creating and trading financial goodies on blockchain, according to a recent report by Bloomberg. They’re currently chatting with potential pals that might boost the platform’s abilities and help come up with new stuff.

Apparently, Tradeweb Markets, a digital trading platform, is set to join the new company as a strategic buddy. The head honcho of Digital Assets at Goldman, Mathew McDermott, said that everything should be set up and ready to roll in the next year or year and a half. Of course, this all depends on getting the necessary approvals from the bigwigs.

According to McDermott, it’s better for the market if this new beast is industry-owned. In the meantime, Goldman Sachs is geared up to launch three new tokenization products later in the year in the US and Europe. This move is mainly due to a big increase in the number of clients interested in crypto.

Goldman’s masterplan is to create marketplaces for tokenized real-world assets and to focus mainly on the fund complex in the United States and Europe’s debt markets. Goldman intends to pitch their new products to other financial institutions rather than ordinary investors and they’ll be using permissioned blockchains to do it.

McDermott believes that this decision will make things move faster and will increase the types of assets that can be used as collateral. He reckons the recent explosion of exchange-traded funds (ETFs) for digital assets is behind the spike in interest for crypto.

There’s been a buy-up of Bitcoin ETFs since US regulators approved them in January. Regulators also approved some for Ether in July. Goldman Sachs themselves were one of the largest buyers of Bitcoin ETFs this year.

There’s now a rising demand for tokenized real-world assets. These allow for low-risk yield from T-bills and other money market instruments. In fact, as of November 14, tokenized US treasury debt holds about $2.4 billion in total value.