Published On: Tue, May 15th, 2018

Bitcoin price: What is Goldman Sachs deal? Will it raise value of cryptocurrency? | City & Business | Finance


Goldman Sachs, the American multinational investment bank, has waded its way into the cryptocurrency market. 

The firm will become the first regulated financial institution to let traders buy and sell futures, marking a whole new chapter in the cryptocurrency saga.

The move will allow Goldman Sachs to bring in old and new institutional investors under the bitcoin wing, boosting trade volume and prices for the foreseeable future. 

Bitcoin is currently flying, trading at $8,765.86 a coin as of 7.30pm today. Prices jumped by more than one percent in the last hour.

The rise comes at a time when much of the cryptocurrency market is hitting a minor slump, with many digital currencies dropping into the red for the start of the week. 

What is the Goldman Sachs deal? 

Goldman Sachs has now opened its doors to bitcoin trading, allowing clients to trade bitcoin futures through its New York desk. 

The move into cryptocurrency comes after a large number of hedge fund, foundation and endowment inquiries – all of which had received donations from bitcoin millionaires – flooded the bank. 

The Wall Street firm will not trade in bitcoin itself, but rather facilitate institutional traders – becoming the first regulated institution to do so. 

Goldman Sachs will use its own money to trade bitcoin futures contracts for its clients. 

The company will also trade non-deliverable forward futures where trades will be settled in the regulated currency it’s quoted in.

Experts believe this new cosign endorsement from such a reputable securities firms will boost cryptocurrency confidence and allow new traders to flood the market. 

The injection of investment funds into the cryptocurrency market comes after eToro senior analyst Mati Greenspan predicted a wave of Wall Street investment entering the space. 

Specifically, he explained that institutional investors were interested in catching Bitcoin at the bottom after missing the boat last year.

Greenspan explained: “So they were trying hard to catch that bull run, and it seems they did miss the party. November was a very interesting time […] I imagine that the clients in the Wall Street banks also wanted to get in on that party.”

Bitcoin has been steadily recovering in price after a dismal Q1 of 2018 saw more than 50 percent of its market cap wiped from the entire market. 

The volatile market had been unsteady in the run up to the US tax deadline which was expected to drive prices down in an attempt by US tax payers to raise cash for capital gains. 

Bitcoin has since jumped by more than $1,000 in price, with many analysts anticipate prices to exceed $20,000 by the end of 2018. 

The Goldman Sachs deal comes after BitMEX, a crypto derivative exchange, offers derivative products to retail investors.

Forbes reported that it now has daily trading volume approaching $3 billion.

Appetite for has gone from strength to strength in the last month, with BitMEX coo Arthur Hayes noting: “This is the best thing you could ever have. 

“We make more money when the market goes down. We love this volatility”



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