Goldman CFO calls story that drove Bitcoin crash "fake news"

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Goldman CFO calls story that drove Bitcoin crash

While many banks and institutional investors are dipping their toes into the world of cryptocurrencies, concerns about everything from money-laundering to market manipulation and unclear regulations have prevented widespread adoption. Prices surged the day the news broke.

The crypto markets were sent into a deep plunge following reports that the investment firm was not about to set up a crypto desk. Fake news, according to Goldman Sachs Chief Financial Officer (CFO) Martin Chavez. Over the past few months, reports have made headlines indicating that the investment company was considering opening a cryptocurrency trading desk that would allow people to buy and sell various virtual currencies.

The bad news was followed by another news which stated that the United States regulators were still very reluctant towards this new form of currency and weren't approving establishment of a bitcoin exchange-traded fund.

Citing unnamed sources familiar with the matter, Business Insider had first reported that Goldman was deprioritizing launching a bitcoin trading desk, responding to a still-murky regulator environment for cryptocurrency trading.

Chavez also said Goldman was trying to develop over-the-counter derivatives for Bitcoin.

"The next stage of the exploration is what we call non-deliverable forwards, these are over the counter derivatives, they're settled in USA dollars and the reference price is the bitcoin-U.S. dollar price established by a set of exchanges", Chavez. Not to panic, Goldman Sachs isn't bowing out of the crypto game any time soon. In the October of 2017, it was said by the authorities in Goldman Sachs that it was planning on coming up with a platform that deals with Bitcoin, along with other digital currencies. He added that his firm was pursuing a derivative of bitcoin because "clients want it". It might take many steps before a regulated bank could trade digital assets, majority outside Goldman Sachs' control, sources had reportedly revealed.

Goldman Sachs was also the first bank to clear CBOE and CME Bitcoin futures, launched past year in December 2017. Though the news is not official, it's acceptable to believe that Goldman Sachs is making such plans. The ban in September a year ago triggered a 6 per cent dip in the price of bitcoin. Deprioritizing due to regulatory uncertainty became the odd news; however, related facts that were discussed like from the perspective of custody and in terms of institutional grade custodial solution for bitcoin were all forgotten.

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