Goldman Sachs is reportedly considering becoming an authorized participant for proposed spot Bitcoin exchange-traded funds (ETFs) by BlackRock and Grayscale, according to sources cited by Coindesk.
This potential move marks a notable departure from the traditional stance of major US banks, which have typically avoided direct involvement in cryptocurrencies.
The involvement of Goldman Sachs places them in a group of financial giants, including JPMorgan Chase, Jane Street, and Cantor Fitzgerald, who are exploring participation in the highly anticipated spot Bitcoin ETFs.
The entry of these financial behemoths into the world of spot Bitcoin ETFs signals a changing landscape that could have significant implications for the future of cryptocurrency investments and regulations.
In a noteworthy development from the previous year, BlackRock took a significant step forward in its pursuit of a spot Bitcoin ETF by amending its application and designating JP Morgan Securities and Jane Street as authorized participants.
This decision underscored the crucial role that authorized participants play in facilitating share creation and redemption processes, streamlining investor entry and exit, as reported by Decrypt.
The deadline for filing amendments set by the US Securities and Exchange Commission (SEC) prompted a flurry of activity within the ETF space.
Valkyrie, in response, nominated Jane Street and Cantor Fitzgerald as authorized participants, further highlighting the significance of these entities.
Amid growing speculation surrounding spot Bitcoin ETFs, Matrixport anticipates that the SEC may reject all the applications.
The crypto investment service provider has cited reservations expressed by the commission’s Chair, Gary Gensler, regarding cryptocurrencies, according to a separate report by Coindesk.
Matrixport argues that the current composition of the SEC leadership, dominated by Democrats, plays a pivotal role in understanding the potential rejections of spot Bitcoin ETF applications.
The approval of a spot Bitcoin ETF holds immense importance for the growth of the crypto market, as it could accelerate the widespread adoption of cryptocurrencies.
However, Gensler’s emphasis on stringent regulatory compliance within the industry suggests a reluctance to swiftly endorse such financial instruments.
The political and regulatory implications may lead to delays in legitimizing Bitcoin as a mainstream store of value through a spot Bitcoin ETF.