Goldman Sachs will invest tens of millions of dollars in cryptocurrency firms.

Following the demise of the FTX, Goldman Sachs (GS) intends to invest tens of millions of dollars in cryptocurrency companies.

KEY LESSONS

Goldman Sachs intends to invest tens of millions of dollars in cryptocurrency companies.
The bank sees an increased need for trustworthy industry players and capitalizes on the crisis.
Currently, the banking behemoth has stakes in 11 digital asset firms.

Make a Crisis an Opportunity

The failure of cryptocurrency exchange FTX is just the latest in a string of high-profile bankruptcies this year, but Goldman's willingness to invest in the sector indicates that it sees potential. While cryptocurrencies are "highly speculative," Goldman Sachs CEO David Solomon is bullish on the underlying technology as its infrastructure develops.

Big banks are seizing the opportunity, according to Goldman's head of digital assets, Mathew McDermott.

"We do see some really interesting opportunities that are priced much more sensibly," McDermott said last month in an interview.

Bank Concentrates on Crypto

So far, the banking behemoth has invested in 11 digital asset firms. McDermott's team has expanded to include a crypto options and derivatives trading desk of seven people. Goldman Sachs launched datonomy, a data service designed to classify digital assets by use, in collaboration with MSCI and Coin Metrics. McDermott also stated that the company is working on its own private distributed ledger technology.

In conclusion

Goldman Sachs' announcement comes as Standard Chartered predicts Bitcoin will fall below $5,000 next year due to investor underpricing. Bitcoin's value has already dropped by more than 75% since last year, and if the crisis worsens, giant banks like Goldman Sachs may be able to profit from the situation.