Goldman Sachs Applies For a DeFi ETF, But Without a Single DeFi Token
The De in DeFi is to do with digitization, the digital transformation of traditional financial services, rather than decentralization. The ETF seeks to track the performance of public companies in the sector included in the “Solactive Decentralized Finance and Blockchain Index.”
Banking giant Goldman Sachs has filed an application with the US Securities and Exchange Commission (SEC) for a crypto exchange-traded fund (ETF).
This crypto ETF called Goldman Sachs Innovate DeFi and Blockchain Equity ETF claims to offer exposure to DeFi, the acronym for decentralized finance.
But sadly, there is not a single DeFi token in this Index; rather, this ETF is providing exposure to public companies in the blockchain and DeFi sector and seeks to track the performance of the “Solactive Decentralized Finance and Blockchain Index.”
The companies involved in this Index include Nokia, Facebook, Alphabet, Accenture, Fujitsu, Cisco, Visa, Microsoft, Mastercard, PayPal, Siemens, Sony, Intel, Overstock, Alibaba, Lenovo, Tencent, Baidu, and Oneconnect.
According to the filing, the fund will invest at least 80% of its assets in securities included in this index.
The Solactive Decentralized Finance and Blockchain Index is based on two key themes. Blockchain technology is one which is defined in the filing as the technology underlying distributed ledgers applicable to payments, currencies, and other fields and industries that depend on a trusted intermediary.
As for DeFi, the second one, it’s to do with digitization and not decentralization. “Digitalization of Finance” is defined as the digital transformation of traditional financial services, including the support and delivery of payments, transaction services, lending, and insurance.
The ETF will focus on markets in Australia, Canada, France, Germany, Hong Kong, Japan, South Korea, Switzerland, the Netherlands, the UK, and the US.
the only crypto etfs that get approved are crypto etfs that don’t give you exposure to crypto. apparently products that do not track what their name would suggest they are supposed to track is good for retail investors.
— ceteris (@ceterispar1bus) July 26, 2021
While the traditional finance people are launching crypto ETFs that are not really providing exposure to the industry and are also getting approved, SEC has yet to give the green light to a single Bitcoin or Ethereum ETF that has been piling on its desk for the past eight years. BTC 0.53% Bitcoin / USD BTCUSD $ 44,056.49
$233.500.53% Volume 33.19 b Change $233.50 Open $44,056.49 Circulating 18.82 m Market Cap 829.35 b 13 h China’s Leading Crypto Exchange, Huobi, Custodies More than $1 Billion in Assets 15 h Google Searches for Bitcoin Hit Dec 2020 Level, Interest in NFTs Surpass DeFi Significantly and Matched Ethereum Briefly 15 h New Jersey Regulators Extend Enforcement on BlockFi BIA Ban to December 1st ETH -1.77% Ethereum / USD ETHUSD $ 3,057.92
-$54.13-1.77% Volume 17.75 b Change -$54.13 Open $3,057.92 Circulating 117.65 m Market Cap 359.77 b 11 h 1Inch Moves to Arbitrum For Faster Throughput And Lower Gas Fees 14 h Wormhole Launches Solana-Ethereum Bridge to Move NFTs Cross-Chain 15 h Google Searches for Bitcoin Hit Dec 2020 Level, Interest in NFTs Surpass DeFi Significantly and Matched Ethereum Briefly
Still, TradeFi has accelerated its involvement in crypto this year with Goldman Sachs’ brokerage division clearing and settling Crypto ETPs for some of its European hedge fund clients.
This makes sense given that the investment bank recently reported that half of the family offices it is doing business with want to add crypto assets to their stable of investments.
Rival bank JPMorgan has also allowed its financial advisors to give all of its retail wealth management clients access to five cryptocurrency funds that include Grayscale’s four products and Osprey's Bitcoin trust. Morgan Stanley has started giving their clients, particularly wealthy ones, access to crypto funds as well.