Goldman Sachs CEO: Big changes in Bitcoin regulation coming


April 8, 2021

David Solomon, chief executive of Goldman Sachs, has said he believes a "big change" is coming soon in the Bitcoin and digital currency markets, particularly in terms of regulation in the US.

The head of one of the world's largest banks made his comments in a media interview today. He didn't say much about Goldman's current Bitcoin practices, suggesting that the current regulatory landscape in the U.S. prevents it from doing so. But Solomon made it clear that Goldman is keeping a close eye on crypto technology because of growing client demand.

"We continue to think in a very positive way about things like digital currency and the digitization of money," Solomon said. At the same time, he said they face "significant regulatory requirements" in terms of specific cryptocurrency initiatives. Goldman plans to start offering bitcoin investment products to its wealth management clients and recently announced the reopening of its cryptocurrency trading desk.

When asked if he would be willing to take over as head of crypto services and whether Washington lobbyists had been able to change the "regulatory rules" that prevented Goldman from doing so, Solomon said: "I think it's an evolving area, and it's an area where we're trying to be responsive to our clients. I think the specific developments in this area will change a lot over the next few years."

In the meantime, Mr Solomon added, the bank was talking to clients and closely monitoring regulations to think about how to move forward.

For now, the rules governing Bitcoin and other cryptocurrencies remain complex, largely because different government agencies still take competing and sometimes contradictory positions on these assets. The US Securities and Exchange Commission, for example, has chosen to regulate securities trading and enforce claims on most etherum-based tokens sold in the US as a way to raise money for start-ups. The CFTC regulates the market for bitcoin derivatives, such as futures and options contracts on exchanges such as Bakkt and CME.

Goldman Sachs will also choose a way to expose its clients to bitcoin. The company last month filed an application with the Securities and Exchange Commission for a new investment product focused on investing in the GrayScale Bitcoin Trust's Ark Innovation ETF.

Goldman Sachs is the latest institution to take an interest in digital assets, though it is treading carefully. At the same time, while the major banks all have different views on decentralized cryptocurrencies, without exception, they are cautious about how they approach and invest in digital currencies.