Goldman Sachs To Clear Bitcoin Futures As Soon As They Go Live
The much-awaited Bitcoin futures are just around the corner and two days away from now. CBOE group has already announced that its Bitcoin futures contracts will go live from Dec 10 which will soon be followed by the launch of Bitcoin Futures by CME Group 8 days later on Dec 18. All the euphoria surrounding Bitcoin Futures has already been reflected in the price of Bitcoin surging by 200% and above in just a month’s time.
Now, as everyone is waiting for the D-day, reports suggest that banking giant - Goldman Sachs Group Inc. is planning to clear Bitcoin futures for some of its clients as soon as the derivatives go live in the next two days. An unidentified person familiar with the matter has said that the banking giant is helping clients to buy and sell bitcoin futures and will act as an agency. It will not be involved in making inventory around the derivatives or not act as a market-maker.
“Given that this is a new product, as expected we are evaluating the specifications and risk attributes for the bitcoin futures contracts as part of our standard due diligence process,” Tiffany Galvin, a spokeswoman for the bank, said in an emailed statement.
On the other hand, banks like Citigroup Inc, and Bank of America won’t be clearing the contracts immediately as soon as the trading goes live. Moreover, as per reports, Bank of America is not planning to engage when the CME Group begins trading on Dec 18.
The Futures Industry Association has been for long arguing that the arrival of Bitcoin futures is been rushed through without weighing the associated risks. The Futures Industry Association comprise of a major group of traders, brokerage firms and banks.
Chairman and CEO of CME Group - Loe Melamed - has said that he considers Bitcoin as an asset class and a store of value. Many others prominent figures from the industry have also resonated with his thought. However, contrary to this, Goldman Sachs CEO - Lloyd Blankfein - thinks it otherwise. He said that it is still too early for his bank to develop a strategy around bitcoin. In his recent interview with Bloomberg TV, Blankfein said: “Something that moves up and down 20 percent in a day doesn't feel like a currency, doesn't feel like a store of value.”
However, Blankfein’s words should not be mistaken as he being a critic of the virtual digital currencies. Although, he prefers to stay cautious at the moment and writes: “I read a lot of history, and I know that once upon a time, a coin was worth $5 if it had $5 worth of gold in it. Now we have paper that is just backed by fiat...Maybe in the new world, something gets backed by consensus.”