Goldman Sachs weighs issuing its own stablecoin

Goldman Sachs, the largest US investment bank, has not ruled out issuing its own stablecoin. This was stated by the bank’s new head of the digital assets division Matthew McDermott, CNBC reports.

“We are studying the commercial viability of a stablecoin. We are at the early stages and continue to explore potential areas of application,” he said.

McDermott has been tasked with expanding his team, doubling headcount in Asia and Europe. According to sources, he has recruited Oli Harris, JPMorgan Chase’s head of digital assets strategy, involved in the creation of JPM Coin, the first digital currency of a major bank.

The primary task of the new head of the Goldman Sachs digital assets department will be transforming the repo market, with a daily turnover of more than $1 trillion. McDermott noted that standardising aging processes using distributed ledger technology (DLT) would lower operating costs and enable real-time settlements.

McDermott is also exploring the possibility of integrating DLT into credit and mortgage markets. This would, however, be impossible without other participants adopting the technology. Therefore, he is in talks to secure adoption of the technology with other companies, including Facebook and JPMorgan.

The 46-year-old veteran of the financial industry is convinced that the future of global financial markets is inextricably linked to the digital ledger and automation.

“In the next 5-10 years the financial system will be different: all assets and liabilities will be blockchain-based, and all transactions will take place on the network. Efficiency can be increased in the issuance of debt securities, securitization, and lending. A digital financial markets ecosystem will be created, with vast possibilities,” McDermott explained.

On cryptocurrencies, the financier said demand has shifted toward institutional investors. He said Goldman Sachs clients are also expressing interest in digital assets.

Earlier in July, Japan’s largest financial conglomerate Mitsubishi UFJ Financial announced the release of a token pegged to the yen in the second half of the year.

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