The Chief Financial Officer for Goldman Sachs, Martin Chavez, responded recently to reports that his company had decided against the start of a planned trading desk for cryptocurrency by calling the reports 'fake news.' The comments from Chavez came while in San Francisco for the TechCrunch Conference. Chavez said that he never imagined that the term 'fake news' would ever leave his mouth. The reports first circulated in December regarding a plan by Goldman Sachs to establish a unit for cryptocurrency in 2018. However, earlier this month a noted industry publication explained that Goldman Sachs had decided against the cryptocurrency idea. The publication cited the reason for the change in plans as the uncertainty surrounding the regulation of cryptocurrencies. The unsubstantiated reports even contained quotes that were said to have been made by Chavez. The quotes suggested that Goldman had jumped the gun just a bit with their plans and that at this time the desired possibilities are not attainable. The truth, as Chavez explains, is that Goldman Sachs has been working to develop the liquidity necessary to allow for Bitcoin futures contracts. He also said that custody solutions would have to be determined before Goldman could move forward with plans for physical Bitcoin. The Goldman Sachs CFO says that the company is preparing a Bitcoin derivative that is traded over the counter for U.S. dollars. The price of reference will reportedly be established by a group of Bitcoin exchanges. Cruz explains that a physical Bitcoin is a prospect that is both exciting and challenging for his company. The news of Goldman Sachs moving away from the planned Bitcoin trading desk caused the value of Bitcoin to fall sharply. This trend also affected other digital currencies. The effects were dramatic and the total market cap experienced a $12 billion decline in slightly less than an hour. The scope of this effect is seen clearly once considering that the top 100 digital currencies experienced losses following the erroneous report.
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