According to a recent report, Goldman Sachs is anticipated to become the latest financial institution to assume the role of an authorized participant (AP) in two significant Bitcoin ETFs.
Traditional finance’s adoption of crypto
As per a report by CoinDesk on Wednesday afternoon, insider sources suggest that Goldman Sachs is exploring a significant role as an authorized participant (AP) in the potential upcoming Bitcoin ETFs from both BlackRock and Grayscale.
If Goldman Sachs proceeds to take on the role of an AP for these anticipated Bitcoin ETFs, it would join other firms like Jane Street, JPMorgan, and Cantor Fitzgerald, which have already expressed interest in serving as APs for various Bitcoin ETF applicants.
This development from Goldman Sachs comes in the wake of a volatile morning for cryptocurrency, witnessing an approximate 8% drop in its value.
A turbulent morning
The abrupt decline in the value of Bitcoin coincided with a recent report from investment services provider Matrixport. The report suggested that the U.S. Securities and Exchange Commission (SEC) was likely to reject all spot Bitcoin ETF applications.
Matrixport’s analysis stated, “While we have seen frequent meetings between the ETF applicants and staff from the SEC, which resulted in the applicants refiling their applications, we believe all applications fall short of a critical requirement that must be met before the SEC approves. This might be fulfilled by Q2 2024, but we expect the SEC to reject all proposals in January.”
Following the release of this report, there was a backlash on social media, with many users calling for an investigation into Matrixport for potential market manipulation.
Spot Bitcoin ETF approval timeline is still unclear
Matrixport co-founder Jihan Wu responded to the backlash, stating, “It’s unrealistic to believe that a Matrixport report could trigger a trillion $ size market to crash. If someone attributes a flash crash to our report, I suggest examining the analysts’ expertise more closely.”
Wu also mentioned “bearish views on X” and “an unexpected drop in crypto stocks for consecutive trading days” as potential additional factors contributing to the decline in Bitcoin’s value. Despite the dip, the cryptocurrency experienced a slight recovery, with its trading value showing around a 5% decrease at the time of the publication.
Goldman Sachs’ entry into the crypto industry as an authorized participant (AP) signals a potential avenue for increased mainstream adoption of cryptocurrency. However, the approval timeline for a spot Bitcoin ETF remains uncertain.
