Goldman Sachs, Bank of America, others cautious on crypto investment

U.S. bankers struck a cautious tone on cryptocurrencies at the Reuters NEXT conference in New York this week, despite expectations that friendlier rules under President-elect Donald Trump will pave the way for lenders to expand into digital assets.

Trump courted crypto campaign dollars with promises to be a “crypto president” and end the Biden administration’s crackdown on the sector, but banks are nevertheless unlikely to rush head-first into the volatile asset, bankers said.

“The regulatory framework has to evolve … and everyone’s speculating as to how that regulatory framework will evolve, but it’s still unclear,” said Goldman Sachs, Chief Executive David Solomon, was quoted by Reuters.

If the rules change, the Wall Street giant would “evaluate” dealing in top cryptocurrencies like bitcoin and ethereum, he said.

“But for the moment … our ability to act in these markets is extremely limited,” he added, noting cryptocurrencies were speculative assets.

BNY recently began offering custody of cryptocurrencies held by exchange-traded products, and the bank is also investing in a range of digital asset services, its CEO, Robin Vince, said. But anything new needs to be done with appropriate guard rails and be “battle-tested” through a few macroeconomic cycles, he said.
“We’ve seen a couple of cycles already in crypto. We’ll have to see how some of these assets evolve,” he added.

Bank of America offers some clients exposure to cryptocurrencies via exchange-traded funds, but there was “not an overwhelmingly large amount of interest,” said Matt Gellene, the bank’s head of Consumer Investments and Employee Banking & Investments.

Affluent young professionals were more likely to shop around for investment options that might include digital assets, said US Bank Senior Vice President and Director of Inclusive Growth Strategy Akita Somani, but US Bank was likewise not seeing “significant demand.”