In the dynamic landscape of the crypto sector, all eyes are on the potential approval of crypto exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC). Recent speculation suggesting a delay in the approval process, including that of BlackRock, triggered a temporary dip in crypto prices. Amid the uncertainties, rumors are circulating that Goldman Sachs is positioning itself as an authorized participant in the proposed BlackRock and Grayscale crypto ETF.
According to insiders familiar with the matter, Goldman Sachs is engaged in discussions to take on the crucial role of an “authorized participant” for both BlackRock and Grayscale‘s Bitcoin ETFs, contingent upon SEC approval. The potential involvement of Goldman Sachs, a prominent player on Wall Street, underscores the growing significance of traditional financial institutions in the crypto market.
The role of an authorized participant is pivotal in the multi-trillion-dollar ETF industry, involving the creation and redemption of ETF shares to maintain alignment with underlying assets. Notably, other financial giants, including JPMorgan Chase, Jane Street, and Cantor Fitzgerald, have already committed to this role for various companies seeking SEC permission to launch Bitcoin ETFs in the United States.
Goldman Sachs‘ potential partnership involves major players in the financial landscape. BlackRock, the world’s largest asset manager, and Grayscale, managing the $26 billion Grayscale Bitcoin Trust, are key entities in this endeavor. Grayscale, having recently won a significant legal battle against the SEC, aims to convert its Bitcoin Trust into a more accessible ETF format.
As the Bitcoin ETF landscape continues to evolve, industry insiders anticipate the emergence of additional authorized participants, with each ETF expected to have five to ten APs.
Goldman Sachs‘ potential involvement as an authorized participant in BlackRock and Grayscale‘s Bitcoin ETFs marks a significant development in the crypto investment realm. The participation of established financial institutions signals a growing convergence between traditional finance and the burgeoning cryptocurrency market, potentially reshaping the future of digital asset investments.
