Goldman Sachs Group Inc is ditching plans to open a desk for trading cryptocurrencies in the foreseeable future as the regulatory framework for crypto remains unclear, Business Insider reported on Wednesday, citing people familiar with the matter.
In recent weeks, executives have come to the conclusion that many steps still need to be taken, most of them outside the bank’s control, before a regulated bank would be allowed to trade cryptocurrencies, the financial news website reported, citing one of the people.
The Wall Street bank was planning to clear bitcoin futures for some clients as the new contracts were going live on exchanges when the cryptocurrency rocketed to a record high of $16,000 in December.
Story continues below advertisement
Regulators across the world have been intensifying their scrutiny of initial coin offerings (ICOs) and cryptocurrency exchanges.
The U.S. Securities and Exchange Commission had warned last year that some of the coins issued in ICOs could be considered securities, meaning trading them would have to comply with federal securities laws.
The virtual currency can be used to move money around the world quickly and with relative anonymity, without the need for a central authority, such as a bank or government. A fund holding the currency could attract more investors and push its price higher.
Bitcoin was trading down nearly 4.8 per cent at $7,007 on the Luxembourg-based Bitstamp exchange on Wednesday.