Goldman’s over-the-counter crypto trade was facilitated by Michael Novogratz’s company, Galaxy Digital Holdings.
Goldman Sachs has completed its first over-the-counter (OTC) trade in cryptocurrency derivatives. This marks the first major U.S. bank to enter the rapidly developing market for crypto options.
The transaction was reported on Monday. The bank executed its inaugural OTC crypto trade using a cash-settled BTC derivative.
According to a CNBC report, Goldman Sachs partnered with Galaxy Digital to successfully complete a cash-settled Bitcoin option.
Anthony Scaramucci of SkyBridge Capital noted that Galaxy Digital assisted the bank in completing the first OTC crypto trade.
Our first was with @GalaxyDigitalHQ too @novogratz
Goldman announces milestone with first over-the-counter crypto trade with Galaxy @CNBCtoo https://t.co/Fd8uyC1vRs
— Anthony Scaramucci (@Scaramucci) March 21, 2022
Cryptocurrency Matures as an Asset Class
Goldman Sachs has previously provided clients with access to cash-settled forwards and exchange-traded options. Still, this OTC transaction represents a notable next step and underscores growing institutional interest in crypto investments.
As traditional finance shifts its view on digital assets, institutional demand for tailored crypto exposure is rising. Max Minton, head of digital assets for Goldman Sachs in the Asia-Pacific region, said the trade is evidence that cryptocurrency is maturing as an asset class. He described the OTC transaction as an important development in the bank’s broader digital assets strategy, centered on the crypto options market.
Galaxy Digital co-president Damien Vanderwilt said Goldman’s OTC Bitcoin trade is a significant first move by a major bank, and that clients will benefit from “direct, customizable access to the cryptocurrency market.”
Bitcoin and other crypto assets are attracting increasing attention, after a period when many mainstream investors and traditional financial institutions treated them with indifference.
Today, a number of leading banks, hedge funds, endowments, family offices, and sovereign wealth funds include cryptocurrencies in their portfolios.