Leading American multinational investment bank Goldman Sachs is planning to expand into Ether and offer futures and options trading in the same, as confirmed by Mathew McDermott, Managing Director of the same. This decision will set the stage for broader adoption of the crypto world’s second largest currency and marks a remarkable departure from the financial services company’s critical stance in the past on digital assets.
An “option” is a sort of derivative contract that provides its purchaser the right to sell or purchase an underlying asset at a set charge at or before an expiration date. You sell or purchase contracts that stand for the value of a specific cryptocurrency in the futures market. When you buy a futures contract, you are not the owner of the underlying cryptocurrency.
McDermott further added that Goldman Sachs plans to enable settlements through exchange-traded notes keeping a track of Bitcoin. He told the business news website Bloomberg, that clients have been showing interest regarding F&O trading as it is a slightly more pleasant entry point. He sees this as a way to deduct a part of the excess and the leverage in the system, more so, from a retail point of view.
Not long ago, Goldman Sachs invested in two crypto startups, namely Coin Metrics and Blockdaemon, as reported by Bloomberg. The former – with its headquarters in Boston, a city in Massachusetts – arranges crypto data of the world and presents it in an accessible and transparent manner. Blockdaemon, a blockchain deployment facilitator has its headquarters in New York, United States.