GOLDMAN SACHS SEES SURGE IN CRYPTO INTEREST FROM INSTITUTIONS 

Goldman Sachs is witnessing a rise in cryptocurrency engagement among its hedge-fund clientele, with Bitcoin being the preferred asset for investment.

A Bloomberg report has highlighted a renewed interest among Goldman Sachs’ Asia Pacific institutional clients in Bitcoin, Ether, and various other cryptocurrencies. This shift signifies a significant change in the approach of traditional financial entities towards crypto investments.

Max Minton, Goldman Asia Pacific’s head of digital assets, reported that a notable portion of the firm’s premier clients has recently started exploring or shown interest in the cryptocurrency sector.

Bitcoin Tops Investment Choices

The spark for this increased interest is partly due to the recent approval of spot Bitcoin exchange-traded funds (ETFs), which has lent a new level of legitimacy to cryptocurrencies among conventional investors.

Minton pointed out that the sanctioning of ten new Bitcoin ETFs in the U.S. during January acted as a key driver for this rejuvenated client engagement and activity. “The approval of these ETFs has revitalized interest and involvement from our clients,” said Minton.

There has been a significant uptick in demand for derivative products offered by Goldman Sachs, especially among hedge funds and institutional investors. Minton highlighted that these derivatives are mainly utilized for hedging against crypto volatility and forecasting price trends in the medium term.

While Bitcoin continues to be the most sought-after asset among their active clients, there is a noticeable curiosity about the prospective approval of a spot Ethereum ETF in the U.S., which could enhance the portfolio diversity of Goldman’s institutional clients.

Despite launching its first crypto trading desk in 2021, Goldman Sachs has not yet made spot cryptocurrency transactions available to its clients, focusing instead on providing access to crypto derivatives, including Bitcoin and Ethereum derivatives.

Analysts Advise Caution Over Ethereum ETF Approval by May

Analysts are advising caution regarding the likelihood of an Ethereum ETF being approved by May, placing the odds at 35%. The extended period of silence from the Securities and Exchange Commission has tempered expectations.

Bloomberg’s ETF analyst, Eric Balchunas, though recognizing the reduced chances of an Ether ETF getting approved soon, remains hopeful about its eventual introduction. “Remember, 35% is not zero. It’s still on the table, and we’re optimistic about its future approval,” Balchunas commented.

Goldman Sachs is planning to broaden its client spectrum to include asset management funds, banks, and firms specializing in crypto assets. Despite the ongoing uncertainties about ETF approvals, the firm is dedicated to innovating and meeting the sophisticated needs of institutional investors interested in the crypto market.

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