As many of the cryptocurrency traders would have known by this time, the crash in the price of Bitcoin, seen on September 5, is mainly believed to be an outcome of Business Insider news that stated Goldman Sachs has suspended its plan to establish a crypto trading desk.
After witnessing the sharp decline, Goldman Sachs has issued a statement denying the report and explained its present stance.
Working on Bitcoin derivatives
According to CNBC, Goldman Sachs CFO Martin Chavez cleared the air by saying that the bank is working on a different type of Bitcoin derivative contract because “clients want it.” The explanation cleared the FUD created by the rumor that Goldman Sachs is suspending its plans to setup a cryptocurrency trading desk.
Commenting on the report Chavez said “I never thought I would hear myself use this term but I really have to describe that news as fake news.” The statement was issued by Chavez at the TechCrunch Disrupt Conference in San Francisco.
Detailing on the crypto plans, Chavez stated that the bank is working on a BTC derivative, dubbed as “non-deliverable forward.” This is being developed as a direct response to the demand from its clients.
Chavez said
“The next stage of the exploration is what we call non-deliverable forwards, these are over the counter derivatives, they’re settled in U.S. dollars and the reference price is the Bitcoin-U.S. dollar price established by a set of exchanges.”
Notably, Bitcoin and other altcoins, which dropped between 10% and 17%, has not yet recovered from the FUD created by Business Insider news. The clarification given by Goldman Sachs confirms the continuing demand for cryptocurrency related products.
