A report from earlier today indicates that Goldman Sachs has decided to shelve its plans to launch a cryptocurrency trading desk. At least in the near term, Goldman is holding off on its crypto ambitions, according to Business Insider. The news immediately threw cold water on the price of Bitcoin which saw the price of the most popular crypto drop below $7000.00.
CNBC reported a cryptic message from the world’s most prominent investment bank;
“In response to client interest in various digital products, we are exploring how best to serve them in the space. At this point, we have not reached a conclusion on the scope of our digital asset offering.”
Market watchers immediately labeled the move as a negative for the legitimization of cryptocurrencies as a new asset class.
Goldman has been rumored to be going crypto for many months. The move was eventually confirmed this past May when Goldman Sachs executive Rana Yared stated in an interview;
“It resonates with us when a client says, ‘I want to hold Bitcoin or Bitcoin futures because I think it is an alternate store of value.’”
But the regulatory environment, for both virtual currencies such as Bitcoin and altcoins, remains in question. Add this to the fact that most crypto “exchanges” are lightly regulated, or not regulated at all, leading to questions regarding the accuracy of global trading volume – something that may have caused concern at the investment bank.
Simultaneously, there have been reports alleging the possible price manipulation of Bitcoin. Goldman’s decision to push pause on a crypto trading desk may also influence other banks sizing up the new market. While the decision by Goldman may just be temporary it is indicative of the relatively immature nature of cryptocurrency.