After the FTX fiasco, Goldman Sachs has been searching for bargain crypto firms to buy after its search for crypto stocks failed, according to Reuters.
Although the collapse of the FTX exchange has impacted valuations and dampened investor interest, Goldman Sachs plans to spend tens of millions of dollars on buying and investing in crypto companies.
The implosion of the FTX exchange has heightened the need for more trustworthy and regulated cryptocurrency companies. According to Goldman Sachs’ head of digital assets, Mathew McDermott, large banks recognize this as an opportunity to get into the cryptocurrency market.
Goldman Sachs is investigating several different crypto firms, he told Reuters, but he did not provide further details.
As a result of the dramatic collapse of FTX in November, which sparked fears of contagion and fueled calls for more regulation of the crypto exchange industry, FTX filed for Chapter 11 bankruptcy protection in the United States on Nov. 11.
Considering that Goldman Sachs’ earnings topped $21.6 billion last year, Goldman may not make a lot of money with its potential investment, but what is clear is its willingness to keep investing throughout the sector shakeout as a sign of its long-term vision.
While the FTX drama unfolded on Nov. 10, one of its CEOs, David Solomon, told CNBC that the core technology behind cryptocurrencies, while he believes they are “highly speculative” at this point, has much potential as their infrastructure becomes more formalized in the coming years.
According to McDermott, Goldman sees hiring opportunities as several techs and crypto companies are shedding staff. For the time being, the bank is happy with the size of its team.
Some people view the recent crypto meltdown as a chance to expand their business rather than see it as a threat. According to Reuters, Britannia Financial Group is currently developing cryptocurrency-related services as part of its goal to grow its business.
According to Bruce, the London-based firm’s goal is to serve customers eager to diversify into digital currencies but unfamiliar with doing so, as they are looking for their first experience in the field. A
s a result of FTX’s collapse, many investors have become nervous about storing funds at crypto exchanges since they were very familiar with the assets. The company will also cater to investors aware of the assets.
It has again been shown that traditional financial companies must recognize the crypto market when making decisions. As opposed to the past couple of years, they have been against the industry and technology; however, the recent incidents show that they are looking for opportunities to profit from this market shortly.