Goldman Sachs Offered Its First BTC-Backed Loan: Report

Goldman Sachs offered the first BTC-backed loan and this move is the biggest step for the investment bank as Wall Street continued to embrace the digital assets so let’s read more in our latest Bitcoin news.

The Wall Street banking giant Goldman Sachs offered its first BTC-backed loan and according to a spokesperson for the bank, the lending facility loaned cash collateralized by the BTC by the borrower. The deal was quite interesting for Goldman because of the structure and 24-hour risk management that they added according to Bloomberg reprots. The arrangement allows crypto owners to get fiat such as USD by using the crypto as collateral but this is the first for the bank.

The move is a sign that the big banks are embracing crypto and broadening their services to incorporate clients with digital asset investment. Goldman has a crypto assets team and traded the first OTC BTC options and became the first major US bank to do so. Goldman announced that it planned to add to the offering with OTC Ethereum options and the analysts at the bank cited Ethereum’s upcoming “Merge” and upgrade to PoS as being bullish for the demand for the asset. According to the glboal head of digital assets for the bank’s private wealth management division, the bank wants to follow Morgan Stanley by offering crypto investmetns for private equity clients.

The big banks follow the footsteps of more specialized companies like Jefferies Financial Group which is expanding banking services for crypto clients. Blackrock invested heavily by contributing a $400 million funding round for the circle. Co-president of Galaxy Digital Holdings Damien Vanderwilt commented that accepting crypto assets as collateral is another step beyond the services like wealth management and investment banking for wall street banks. The crypto-centric banks like Silvergate Capital provide loans for crypto collateral.

The Wall Street giant was anything but optimistic in regards to the crypto industry until a year ago. It went from having a digital asset trading platform to stopping it years later while also bashing BTC in the meantime. In one case from May 2020, the bank said BTC is nto an asset class, and some months further, Goldman started changing the tune by hiring a crypto research team and publishing a few bullish reports, and predicting a $100K price tag for BTC and took part in funding rounds with a filing for a Bitcoin ETF.