Investment firm Goldman Sachs Group is about to dip a toe into the Bitcoin market, according to people familiar with the bank’s strategy. Bitcoin is heavily associated with cybercrime – in particular ransomware.
Goldman Sachs is setting up a trading desk to create markets in digital currencies, Bloomberg reports, citing two people with knowledge of the firm’s long-term plans.
“In response to client interest in digital currencies, we are exploring how best to serve them,” firm spokesman Michael DuVally told the news agency.
Goldman Sachs has set its sights on Bitcoin, risky but potentially extremely profitable crypto currency that has captured the imagination of the world, including hackers. Cybercriminals love crypto currencies for one major advantage: anonymity.
The proliferation of ransomware – currently the #1 cyberthreat – was made possible partially thanks to digital currencies. After encrypting a victim’s computer, cyber crooks leave their Bitcoin wallet’s address on the screen demanding ransom be paid at that address in the form of cryptocurrency. While the public can see the wallet and its contents, no one knows who owns it.
Other popular “altcoins” (as they are collectively called) include Monero, Ethereum, Litecoin and Zcash – each with their respective valuation and unique pros and cons. However, no altcoin is more valuable than Bitcoin, currently trading at around $14,000 apiece.
But because it isn’t backed by any real assets, and because it is a cybercrime currency, Bitcoin is also highly volatile – making it a very risky affair for Wall Street. Just last week, Bitcoin peaked at an impressive $20,000 per coin.
Also worth noting, several cryptocurrency concerns have fallen victim to cyberattacks. NiceHash, the self-proclaimed “largest crypto-mining marketplace” lost $60 million to hackers earlier this month.
Perhaps not surprisingly then, banks like Citigroup and Bank of America have taken a wait-and-see approach.