Goldman Sachs plans to spend tens of millions of dollars to buy or invest in crypto companies after the collapse of the FTX exchange hit valuations and dampened investor interest.
FTX's implosion has heightened the need for more trustworthy, regulated cryptocurrency players, and big banks see an opportunity to pick up business, Mathew McDermott, Goldman's head of digital assets, told Reuters.
Goldman is doing due diligence on a number of different crypto firms, he added, without giving details.
"We do see some really interesting opportunities, priced much more sensibly," McDermott said in an interview last month.
FTX filed for Chapter 11 bankruptcy protection in the United States on Nov. 11 after its dramatic collapse, sparking fears of contagion and amplifying calls for more crypto regulation.
"It's definitely set the market back in terms of sentiment, there's absolutely no doubt of that," McDermott said. "FTX was a poster child in many parts of the ecosystem. But to reiterate, the underlying technology continues to perform."
While the amount Goldman may potentially invest is not large for the Wall Street giant, which earned $21.6 billion last year, its willingness to keep investing amid the sector shakeout shows it senses a long term opportunity.
Its CEO David Solomon told CNBC on Nov. 10, as the FTX drama was unfolding, that while he views cryptocurrencies as "highly speculative", he sees much potential in the underlying technology as its infrastructure becomes more formalized.
Rivals are more sceptical.
"I don't think it's a fad or going away, but I can't put an intrinsic value on it," Morgan Stanley CEO James Gorman said at the Reuters NEXT conference on Dec. 1.
HSBC CEO Noel Quinn, meanwhile, told a banking conference in London last week he has no plans to expand into crypto trading or investing for retail customers.
