Goldman Sachs issues first bitcoin-backed loan

Goldman Sachs issued the first bitcoin-backed loan. Bloomberg reported this, citing a representative of the investment bank.

The deal structure and the 24/7 risk-management framework attracted the lender.

The move marks Goldman Sachs’s full foray into the cryptocurrency market. The deal had been in the works since December 2021. Media at the time also reported the bank’s interest in synthetic products not involving a spot exposure to the first cryptocurrency.

Currently, crypto-friendly banks Signature and Silvergate offer similar bitcoin-backed loans.

In 2021, Goldman Sachs offered clients futures and options on bitcoin and Ethereum. The bank also launched non-deliverable forwards on Bitcoin, settled in fiat.

In March 2022, Goldman Sachs and Galaxy Digital conducted an OTC trade with a cash-settled bitcoin option.

In April, a bank spokesperson said experiments had begun in the tokenisation of real assets and NFTs applied to financial instruments.

Earlier, an interagency sprint involving the Fed, FDIC and OCC began, and will continue in 2022. The group of regulators will issue guidance on legally permissible activities for banks related to cryptocurrencies.

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