The market’s biggest digital coins dropped sharply on Wednesday amid a report that Goldman Sachs Group is pulling back on near-term plans to set up a cryptocurrency trading desk.
Bitcoin, the biggest digital asset, erased gains and fell more than 3% in about 10 minutes. Litecoin, ethereum and ripple followed suit. Ethereum skidded by as much as 12%.
Goldman Sachs has moved its plan for a crypto trading desk lower down on its priority list, Business Insider reported, citing people familiar with the matter. The Wall Street banking giant is focused on other digital-coin services, such as a custody product, the report said.
“In response to client interest in various digital products we are exploring how best to serve them in this space,” a spokesman for Goldman Sachs said. “At this point we have not reached a conclusion on the scope of our digital asset offering.”
Goldman Sachs had been taking baby steps around cryptocurrencies since hiring Justin Schmidt earlier this year as head of its digital-asset markets. It was among the first Wall Street firms to clear bitcoin futures offered by Cboe Global Markets and CME Group.
“The expectation of adoption by Wall Street has been a major theme for the cryptocurrency market for the last year, so any kind of updates on that can certainly move the prices,” said Mati Greenspan, senior market analyst at currency trader eToro, by phone from Russia. “Even if it’s not true, it should be enough to cause a minor selloff like this in cryptocurrencies.” — Reported by Todd White and Lily Katz, with assistance from Sridhar Natarajan, (c) 2018 Bloomberg LP