After FTX’s failure, Goldman Sachs apparently intends to spend “tens of millions of dollars” to acquire or invest in crypto businesses.
Goldman Sachs aims to spend “tens of millions of dollars” to acquire or invest in crypto businesses whose values have been affected by the bankruptcy of FTX.
According to a report by Reuters, the bank is doing due diligence on a number of crypto companies. Mathew McDermott, head of digital assets at Goldman Sachs, said, “We certainly see some really exciting prospects that are priced lot more fairly.”
Goldman Sachs is an investor in a number of cryptocurrency companies, including CertiK, TRM Labs, Elwood Technologies, and Coin Metrics. The investment bank reestablished a bitcoin trading desk earlier this year in response to rising demand from institutional customers. According to McDermott, more than seventy individuals are presently employed by Goldman’s digital assets unit, and the firm is also developing its own proprietary distributed ledger technology.
The FTX situation presents an opportunity for Goldman Sachs. McDermott said that the fall of the cryptocurrency exchange “certainly put the industry back in terms of mood” as “FTX was a poster child for many sections of the ecosystem.” McDermott thinks that “the underlying technology continues to function.”
On 11 November, FTX filed for chapter 11 bankruptcy protection due to a cash crisis. Alameda Research, a trading business linked with the defunct cryptocurrency exchange, purportedly used user funds to finance hazardous bets, causing the exchange’s downfall.
The fall of FTX enhanced Goldman Sachs’ trading volume as investors migrated to regulated and well-capitalized participants. Goldman Sachs did not answer The Block’s request for comment immediately.
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