There have been rumors that Goldman Sachs might work with FTX to offer crypto derivative services. The derivative services will be for Bitcoin and another cryptocurrency trading. If this collaboration does happen, it will be one of the biggest partnerships between a firm and a crypto exchange. However, FTX is also reportedly seeking a modification in its operating license. This will allow them to operate as an exchange and derivatives intermediary, simultaneously removing Goldman Sachs from the picture.
Goldman Sachs and FTX partnership
For now, FTX doesn’t have the license to offer derivative services directly to clients. Therefore, there is the possibility of them partnering with Goldman Sachs to offer the services. But if they are able to get the licensing modification approved, we can expect FTX to cut off Goldman Sachs and offer the services themselves. They are working with many Futures commissions merchants to integrate the options with their platform as well, reported FTX’s US division president, Brett Harrison.
Sooner or later, the modification in the license of FTX is going to get approved, and it could bring a significant change in the way firms like Goldman Sachs position themselves. There are reports that FTX is already absorbing the market share of competitors from wall street.
However, there will be many obstacles on the way and friction among the authorities to approve such a major change. The intermediaries getting completely cut off means billions of dollars in business are completely gone. So, the Futures Industry Association could try to push that the change is not accepted.
About Goldman Sachs
Goldman Sachs was founded in 1869 and has offices in London, Warsaw, Bangalore, Hong Kong, Tokyo, Salt Lake City, and other locations in other international financial cities. It is ranked at number 2 globally in terms of revenue among investment banks and is at 59th position in the Fortune 500 ranking of the top US firms also by total revenue. The Financial Stability Board considers it a significant financial institution.
Investment banking, securities underwriting, asset management, and investment management, as well as prime brokerage, are the services offered by Goldman Sachs. It trades mortgage-backed securities, credit products, insurance-linked securities, currencies, securities, commodities, equity derivatives, equities, structured products, options, and futures contracts as a market maker and broker.
What are your thoughts as rumors suggest that Goldman Sachs might work with FTX? And do you think FTX will be able to get the modification in their license approved? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.