American multinational investment bank and financial services company Goldman Sachs has executed its first over-the-counter (OTC) crypto transaction.
As first reported by CNBC on Monday (March 21), Goldman traded a bitcoin-linked instrument called a non-deliverable option with Galaxy Digital, “a technology-driven financial services and investment management firm that provides institutions and direct clients with a full suite of financial solutions spanning the digital assets ecosystem.”
The report went on to say that “the move is seen as a notable step in the development of crypto markets for institutional investors” partly because Goldman is “taking on greater risk by acting as a principal in the transactions.”
Galaxy Digital Co-President Damien Vanderwilt told CNBC in an interview:
“This trade represents the first step that banks have taken to offer direct, customizable exposures to the crypto market on behalf of their clients.“
Vanderwilt also mentioned that option trades are “much more systematically relevant to markets compared to cleared futures or other exchange-based products,” before adding that “at a high level, that’s because of the implications of the risk banks are taking on; they’re implying their trust in crypto’s maturity to date.”
Max Minton, Goldman’s Asia Pacific Head of Digital Assets, said in a statement:
“We are pleased to have executed our first cash-settled cryptocurrency options trade with Galaxy. This is an important development in our digital assets capabilities and for the broader evolution of the asset class.“
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.