It is not yet clear what consequences the spectacular bankruptcy of FTX will have on the crypto world in the long term. But many small investors are pulling out for fear of further bankruptcies. Not so Wall Street giant Goldman Sachs.
On the contrary, the legendary investment bank is using falling prices to rise and buy more of its own holdings. There is apparently no risk of a chain reaction that could cause further price drops.
Buybacks are planned
In any case, Mathew McDermott, head of digital assets at Goldman Sachs, sees attractive pricing options for his bank. This view is not surprising given that Goldman Sachs already has a lot of experience in the industry.
As McDermott reported in an interview, the investment bank is doing due diligence on several crypto companies. However, he declined to give details. According to Reuters news agency, Goldman Sachs is apparently planning to invest tens of millions of dollars in crypto companies. A complete takeover of individual companies is not entirely out of the question.
Investors are looking for trusted partners
This proves that the investment bank is undeterred by the latest developments surrounding FTX. McDermott pointed out that the bankruptcy proves the importance of trustworthy players in the crypto market. The banks would now see their chance to make a splash in the industry.
Goldman Sachs apparently wants to secure a spot at the top. The investment bank has been active for quite some time and has invested in several companies. These offer data analysis for cryptocurrencies, compliance services, and blockchain management. Goldman Sachs’ Head of Digital Assets department now has about 70 employees. A team of seven traders is dedicated exclusively to derivatives and options.
In an interview, McDermott pointed out that FTX’s failure actually boosted his bank’s business. Since then, the number of financial institutions has increased as many are looking for a trusted partner.
Peanuts versus profit
But the statements of the leader of Goldman Sachs are also related. After all, the investment bank made over $21 billion in profit last year. In contrast, the double-digit million figure mentioned in the interview looks like peanuts. Goldman Sachs therefore places only a very small proportion of its capital in crypto-currencies and companies active in this field.
The investment bank is thus diversifying its investments in order to have a foot in the door as soon as the market starts rising again.
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