Crypto News: Goldman Sachs Announces New Digital Assets Director

Crypto News: Goldman Sachs Announces New Digital Assets Director

Goldman Sachs Announces New Digital Assets Director Goldman chooses a new digital assets director to push blockchain initiaitives. By Luke Conway Updated Aug 7, 2020 Goldman Sachs ( GS ) has just announced Matthew McDermott as its new managing director of digital assets in a new push towards a digital asset future. McDermott was previously the director of the bank’s internal funding operations. Key Takeaways Goldman Sachs has announced a new managing director for digital assets The new director, Matt McDermott, has a positive outlook for the future of blockchain use in the finance industry. A growing finance industry trend suggests that blockchain and cryptocurrency will see more use. This is particularly interesting as McDermott is an older, more veteran member of Wall Street compared to the young crypto trader and MIT grad, Justin Schmidt, who formerly held the position. This is also interesting because McDermott has a very high regard for the future use of blockchain technology and digital assets within the financial industry. McDermott holds the view that in time all of the world’s financial assets will be entirely digital and tracked on open blockchain ledgers. McDermott said in a recent CNBC interview   that: “In the next five to 10 years, you could see a financial system where all assets and liabilities are native to a blockchain, with all transactions natively happening on-chain. So what you’re doing today in the physical world, you just do digitally, creating huge efficiencies. And that can be debt issuances, securitization, loan origination; essentially you’ll have a digital financial markets ecosystem, the options are pretty vast.” This is a significantly positive outlook on a technology that has, in the past, been ignored by Wall Street members. It is in especially stark contrast to Warren Buffet’s take on cryptocurrency when he famously said: “Cryptocurrencies basically have no value and they don’t produce anything.” A company with such a status as Goldman Sachs that shows positive sentiment in blockchain use is a good sign for the future blockchain and cryptocurrency progression. McDermott went on to say in his CNBC interview that: “In securities finance and repo, if you look at those markets, they’re ripe for standardization. There’s a lot of legacy processes in the vast movement of collateral that makes them very cost inefficient, so by leveraging distributed ledger technology, you can standardize processes to manage collateral across the system, and you have a much more efficient settlement process given the real time settlement.” This new take on blockchain as a tool for efficiency can potentially have a profound impact on the industry. When looking at the broader landscape of blockchain, there is a lot going on. In 2018 JPMorgan ( JPM ) created its own JPMcoin which it uses to facilitate interbank payments. China over the past year has begun a major push to make a digital version of its Yuan. Even the United States has considered this possibility for the dollar. In Q1 of this year payment apps, like Square ( SQ ) and CashApp, have made huge amounts of revenue from BItcoin related trading on their platforms. Facebook ( FB ) has completely reimagined its Libra coin to alleviate regulatory concerns and seems very intent on pursuing the project. Now, Goldman Sachs has reinvested in the push for more financial blockchain solutions. A growing trend of investment and interest among the financial industry seems to be quite strong. These trends could make the blockchain industry more compelling to serious financial industry players. McDermott went on to say in his CNBC interview that: “We’ve definitely seen an uptick in interest across some of our institutional clients who are exploring how they can participate in this space. It definitely feels like there is a resurgence of interest in cryptocurrencies.” Cryptocurrency Performance: Year-to-Date Bitcoin Cash ( BCH ) YTD: 57.21% Ripple ( XRP ) YTD: 58.29% S&P 500 YTD: 3.46% Investing in cryptocurrencies and Initial Coin Offerings (“ICOs”) can be highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual’s situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. Article Sources Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

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