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Goldman (GS) Conidered as Potential AP for Spot Bitcoin ETF
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The Goldman Sachs Group, Inc. (GS - Free Report) is being considered to become the authorized participant (AP) for the spot Bitcoin exchange-traded fund (ETF), which Grayscale and BlackRock Inc. (BLK - Free Report) are planning to launch.
Apart from GS, JPMorgan Chase & Co. (JPM - Free Report) is being considered as a potential AP for the ETF. This was first reported by Coindesk.
BLK became the first asset manager to file for the spot Bitcoin ETF in June 2023, paving the way for a wave of filings by other asset managers like Fidelity, Invesco and WisdomTree, Inc. (WT - Free Report) .
The U.S. Securities and Exchange Commission (SEC) is expected to announce its decision on the trading of spot bitcoin ETF’s latest by Jan 10, 2024. To date, the approved cryptocurrency ETFs in the United States are those that include future contracts on Bitcoin and Ethereum. The pending approval from SEC will provide investors direct exposure to the price of cryptocurrency without having to purchase them.
BlackRock also filed for a spot Ethereum ETF named iShares Ethereum Trust in November 2023. The Ethereum ETF, if approved, will be the first of its kind in the United States.
While BLK is expanding its cryptocurrency exposure, JPM has been undertaking measures to subdue them. In September 2023, JPM stated that its retail bank, Chase, in the U.K. had decided to restrict customers’ access to cryptocurrency-related transactions due to increased scams and fraud cases. Nonetheless, it has been exploring the concept of launching a blockchain-based deposit token for customers, provided it receives the required regulatory approval.
JPMorgan and Goldman as APs for spot Bitcoin ETF would be entrusted with the responsibility of tracking the ETF share price with underlying assets of fund. The companies will be required to create and redeem the shares of ETF, thus supplying the required liquidity.
Beside this, Goldman has been focusing on growth in its core strengths of investment banking and trading since it has been pulling back from its consumer lending business. Such growth moves by GS are necessary to support its top-line expansion.
Per an internal memo circulated last year, GS had disclosed changes in its senior executives’ positions as it intended to expand its operations in the private credit space. It further aims to double the size of business targeting assets worth $110 billion under management over the medium term.
Further, it has been aiming to expand its offerings across the high growth countries. In December 2023, Bloomberg reported that GS was planning to enhance its credit business in India as it is one of the fastest-growing economies in the world. Per Sonjoy Chatterjee, chairman and chief executive officer of Goldman in India, the bank intends to broaden the range of its loan offerings in this country.
The firm also desires to obtain a license to boost its currency trading that would permit it to deal with counterparties like financial investors, equity customers or a corporate customer. This apart, GS believes that deal-making activity in the country is likely to receive a boost.
Goldman’s shares have gained 16.9% over the past six months compared with the industry’s 11.3% growth.
Image: Bigstock
Goldman (GS) Conidered as Potential AP for Spot Bitcoin ETF
The Goldman Sachs Group, Inc. (GS - Free Report) is being considered to become the authorized participant (AP) for the spot Bitcoin exchange-traded fund (ETF), which Grayscale and BlackRock Inc. (BLK - Free Report) are planning to launch.
Apart from GS, JPMorgan Chase & Co. (JPM - Free Report) is being considered as a potential AP for the ETF. This was first reported by Coindesk.
BLK became the first asset manager to file for the spot Bitcoin ETF in June 2023, paving the way for a wave of filings by other asset managers like Fidelity, Invesco and WisdomTree, Inc. (WT - Free Report) .
The U.S. Securities and Exchange Commission (SEC) is expected to announce its decision on the trading of spot bitcoin ETF’s latest by Jan 10, 2024. To date, the approved cryptocurrency ETFs in the United States are those that include future contracts on Bitcoin and Ethereum. The pending approval from SEC will provide investors direct exposure to the price of cryptocurrency without having to purchase them.
BlackRock also filed for a spot Ethereum ETF named iShares Ethereum Trust in November 2023. The Ethereum ETF, if approved, will be the first of its kind in the United States.
While BLK is expanding its cryptocurrency exposure, JPM has been undertaking measures to subdue them. In September 2023, JPM stated that its retail bank, Chase, in the U.K. had decided to restrict customers’ access to cryptocurrency-related transactions due to increased scams and fraud cases. Nonetheless, it has been exploring the concept of launching a blockchain-based deposit token for customers, provided it receives the required regulatory approval.
JPMorgan and Goldman as APs for spot Bitcoin ETF would be entrusted with the responsibility of tracking the ETF share price with underlying assets of fund. The companies will be required to create and redeem the shares of ETF, thus supplying the required liquidity.
Beside this, Goldman has been focusing on growth in its core strengths of investment banking and trading since it has been pulling back from its consumer lending business. Such growth moves by GS are necessary to support its top-line expansion.
Per an internal memo circulated last year, GS had disclosed changes in its senior executives’ positions as it intended to expand its operations in the private credit space. It further aims to double the size of business targeting assets worth $110 billion under management over the medium term.
Further, it has been aiming to expand its offerings across the high growth countries. In December 2023, Bloomberg reported that GS was planning to enhance its credit business in India as it is one of the fastest-growing economies in the world. Per Sonjoy Chatterjee, chairman and chief executive officer of Goldman in India, the bank intends to broaden the range of its loan offerings in this country.
The firm also desires to obtain a license to boost its currency trading that would permit it to deal with counterparties like financial investors, equity customers or a corporate customer. This apart, GS believes that deal-making activity in the country is likely to receive a boost.
Goldman’s shares have gained 16.9% over the past six months compared with the industry’s 11.3% growth.
Image Source: Zacks Investment Research
GS presently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.