Quick take:
The new platform will allow large financial institutions to create, trade and settle financial instruments like bonds and cash on the blockchain.
Goldman Sachs is also looking to facilitate secondaries transactions in privately held digital companies for its clients.
The company has already partnered with the electronic trading platform Trade Markets to enable new use cases in the digital platform.
Goldman Sachs is looking for partners as it plans to spin out its digital asset unit, Mathew McDermott, Goldman’s global head of Digital Assets told Bloomberg in an interview.
The news comes just as the crypto industry continues to rally on the tailwinds of Trump’s big re-election win on November 4th.
Goldman is building a platform that allows large financial institutions to create, trade and settle financial instruments like bonds and cash on the blockchain. The company has already teamed up with the electronic trading platform Trade Markets to enable new use cases in the digital platform.
According to the report, Goldman is also looking to facilitate secondaries transactions in privately held digital companies for its clients. The company has also set plans in motion to resume its Bitcoin-backed lending activities.
Mathew McDermott, Goldman’s global head of Digital Assets plans to spin out the new company are in the early stages, but the long-term goal is to execute the spin-out within the next 12 to 18 months, subject to regulatory approvals.
“It’s in the best interest of the market to have something that is industry-owned,” he said.
Launched in 20222 for the issuance of digital assets using blockchain technology, the Goldman Sachs Digital Asset platform has already been used by the likes of the European Investment Bank to issue bonds.
Although the spun-out unit will be owned by a different company, Goldman Sachs plans to retain its digital assets team as it expands into broader activities in the space, McDermott said.
Goldman is not the only major U.S. bank to venture into blockchain-based business. JPMorgan’s Kinexys (formerly Onyx) has been helping large financial institutions to issue tokenised products. According to JPMorgan, the platform averages more than $2 billion in transactions per day and has already processed over $1.5 trillion since inception.
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