Reports of institutional crypto desks have been greatly exaggerated

Todays news that Goldman Sachs is opening a Bitcoin trading desk is good news for the crypto economy as a whole. But is it a real shift in perception for crypto at big institutions?

Not likely, said David Gerard, author of Attack of the 50 Foot Blockchain.

“If you look closely at the reports, they haven’t opened a crypto desk yet, nor do they have a date to do so – the news story is that they’ve hired one guy to look into the possibilities,” he said. “The key point is from the original Tearsheet report-‘Goldman maintains that contrary to months-long rumors it has no plans to launch a crypto trading desk.’”

Bitcoin price spiked on the news today and it seems that many believe this is an investigative move rather than one that will change trading patterns.

“My assessment is that while they were waiting for cryptocurrency to validate itself, they were allocating resources and staff into the new sector behind the scenes,” said Coinsource CEO Sheffield Clark.

Crypto programmer Jameson Lopp is skeptical.

“It’s surprising to me given that Goldman Sachs is bearish on BTC,” he said. “Perhaps there was sufficient demand from their clients for bitcoin exposure.”

Many large companies – EY, for example – have built a great deal of hype around blockchain support, garnering them clients and new work. This move by Goldman, if true, is exciting but it is about as indicative of a general move towards crypto assets as the CEO buying a single bitcoin.

“If valuable customers wanted to trade Beanie Babies then you’d expect GS to look into a desk for those too. GS does have various interests in crypto-related businesses already,” said Gerard. “I don’t know of other large investment banks doing this. But I think the future is to approach it carefully and trepidatiously. You can make money off cryptos, but it’s a super-risky market in an incredibly volatile junk-quality asset. So caution is appropriate. The key point is this isn’t some sort of tipping point for real-world acceptance of Bitcoin, as much as Bitcoin fans would like to paint it as one.”

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