Goldman Sachs Aims to Help Investors Analyze Crypto Markets
In the near future, Wall Street giant Goldman Sachs will offer institutional clients an online resource that explains and categorizes cryptocurrencies. Institutional investors can gain a better understanding of the hundreds of coins and tokens with a service called Datonomy.?
Data feeds can be used for analysis, research, benchmarking, portfolio management, and product development based on multiple fields such as blockchain and decentralized finance, metaverses, and smart contracts among others.
It's a partnership between global index provider MSCI and crypto data firm Coin Metrics. According to the announcement, "The new framework for digital assets classification is designed to provide investors, service providers, developers, and researchers a way to help monitor market trends, analyze portfolio risk and returns, and help build new products."
The market cap of cryptocurrency assets soared during the pandemic, reaching $3 trillion. In the aftermath of interest rate hikes by the Federal Reserve, the market only shrunk slightly, which drained liquidity out of the system.?
In this scenario, the financial giant is helping institutional investors stay on top. Head of the client strategy for Goldman's Marquee platform, Anne Marie Darling says the framework should prove useful because digital assets need to be tracked constantly and monitored.
As a result of the database, market participants will also be able to get a better understanding of what is happening in the different crypto spaces, such as decentralized finance (DeFi) and smart contract platforms.
Earlier this year, Goldman Sachs formed its first OTC crypto transaction by purchasing a non-deliverable Bitcoin option (NDO) from Galaxy Digital. Additionally, the bank backed its first loan with bitcoin in April.
CBW - External Analyst