Goldman Sachs Plans Strategic Spin-Off to Develop Crypto Products
Investment banking giant Goldman Sachs is set to split its crypto platform to form a new autonomous entity. This decision, reported by Bloomberg, marks a significant step in the company’s strategy to expand its operations on blockchain networks and develop innovative financial instruments.
Mathew McDermott, Global Head of Digital Assets at Goldman Sachs, stated that the bank is in discussions with potential partners to enhance the capabilities of this new entity and offer new market-tailored offerings.
One of the envisioned strategic partners is Tradeweb Markets, a renowned electronic trading platform. This collaboration is expected to strengthen the efficiency and attractiveness of the spin-off entity, allowing it to optimize operations and diversify its products.
A Project Subject to Regulatory Approval
“It is in the sector’s interest to have a structure owned by the industry itself.” – Mathew McDermott, Head of Digital Assets at Goldman Sachs
According to McDermott, the completion of this spin-off could occur within 12 to 18 months, subject to regulatory approvals. While the project is still in the preliminary phase, the executive highlights its relevance for the market.
Goldman Sachs emphasizes a collaborative governance approach, strengthening transparency and trust in blockchain transactions.
The Rise of Tokenization and Real-World Asset Markets
Simultaneously, Goldman Sachs continues its efforts to expand its footprint in asset tokenization. In July, McDermott revealed the bank’s ambitions to launch three new tokenization products in 2024 on the US and European markets. This initiative addresses the growing interest of clients in blockchain-based financial products. The bank plans to create marketplaces for Real World Assets (RWAs), focusing on the complex realm of funds and European debt markets.
These new platforms will target financial institutions rather than individual investors and will exclusively use permissioned blockchains. The goal is to differentiate themselves through speed of execution and the diversity of eligible assets as collateral.
A Favorable Environment and Increasing Demand
Goldman Sachs’ renewed activity in the crypto sector is partly fueled by the rise of exchange-traded funds (ETFs) backed by digital assets. Since January, nearly a dozen Bitcoin ETFs have been launched after receiving final approval from US regulators. In July, Ethereum ETFs were also authorized, marking a new milestone in the institutional adoption of digital assets.
This momentum is accompanied by strong demand for tokenized RWAs, which offer relatively low but secure returns, primarily through US Treasury bonds and other money market instruments. As of mid-November, the total value locked in tokenized US Treasury debt reached approximately $2.4 billion, according to RWA.xyz data.
