Goldman Sachs Group Inc (NYSE:GS) is said to be holding discussions while it considers getting into the crypto storage services space. It is planning on providing the custodial services that will allow cryptocurrency funds invested in coins like Bitcoin (BTC-USD) to store digital coins safely.
One of the biggest hindrances that stand in the way of institutional investors from investing in digital currencies is storage of the coins. The said investors are wary of the risk of storing the virtual currency in some server in an unknown location. Reports of several exchanges being hacked and cryptos being stolen do not help the situation.
Attracting institutional investors
However, with the interest of Goldman to provide custodial services will go a long way in attracting institutional investors into the crypto sector. The investment bank is said to be planning on offering dependable and secure storage services for the crypto funds.
Goldman’s clients will benefit from an institutional channel whereby they will be in a position to efficiently administer their digital assets. In addition to providing security, the investment bank will also provide its clients with insurance services for their held coins.
An unnamed spokesperson for the investment bank touched on the subject by stating that, “In response to client interest in various digital products we are exploring how best to serve them in this space. At this point, we have not reached a conclusion on the scope of our digital asset offering.”
Lead the way
If Goldman Sachs succeeds with the project, it would heighten the confidence surrounding the crypto funds. Furthermore, it will lead the way for other investors to jump into the digital assets sector.
According to Bloomberg, the project would help create other business opportunities such as prime brokerage services. Such a move would mean that Goldman would accept the digital currency as collateral. At the same time, hedge funds would have the potential to bypass the USD as an exchange currency.
In the meantime, Bloomberg revealed that other wall street giants, JP Morgan Chase, Bank of New York Mellon Corp, and Northern Trust are all exploring on the idea of a digital currency custodial service.