According to a Bloomberg report, institutional clients of Goldman Sachs' Asia Pacific division are showing renewed interest in Bitcoin, Ethereum and other crypto assets. This trend indicates a noticeable development in the investment landscape of traditional financial institutions.
According to Max Minton, head of digital assets at Goldman Asia Pacific, a significant number of the firm's largest clients have recently engaged or are considering opportunities in the cryptocurrency industry.
Bitcoin is still the most popular
This surge in interest comes after the approval of Bitcoin exchange-traded funds (ETFs), a move that legitimized crypto assets in the eyes of traditional investors.
Minton highlighted the impact of the approval of ten new bitcoin ETFs in the US in January, which he described as a catalyst for renewed interest and activity among clients. “The recent ETF approval has led to a return of interest and activity from our clients,” Minton stated.
Goldman Sachs has seen a rise in demand for its derivatives offerings, especially from hedge funds and other institutional clients. Minton noted that clients mainly use derivatives to gain exposure to cryptocurrency volatility and forecast medium-term price movements.
According to Minton, Bitcoin remains the most popular investment vehicle among active clients. However, there is growing anticipation surrounding the potential approval of an Ethereum spot ETF in the US, which could further diversify the portfolios of Goldman's institutional clients.
It is worth noting that despite setting up its inaugural cryptocurrency trading desk in 2021, Goldman has not yet offered spot cryptocurrency products to its clients. Instead, the desk exclusively facilitates exposure to cryptocurrency derivatives, including assets such as Bitcoin and Ethereum.
Analysts warn that approval of an Ethereum ETF by May is unlikely
However, analysts express caution about the possibility of an Ethereum ETF being approved by May, estimating the probability at 35%. Market participants' optimism has been dampened by the SEC's extended silence on the issue.
Eric Balchunas, an ETF analyst at Bloomberg, acknowledged the diminishing likelihood of Ethereum ETFs being approved, but maintained optimism about their eventual rollout, saying: “Note: 35% is not 0%, it is still possible, and “In the long term we think it will be so.” “It happened,” Balchunas noted.
Looking to the future, Goldman Sachs aims to expand its client base to include asset management funds, banks and specialist crypto asset companies. Despite the uncertainty surrounding ETF approvals, the company remains committed to providing innovative solutions and meeting the evolving needs of institutional investors in the cryptocurrency space.
