Goldman Sachs pushes into cryptoassets with new hire

Goldman Sachs has promoted Mathew McDermott to become its new global head of digital assets, as part of a push towards legitimising blockchain within banking.

He replaces Justin Schmidt, a former crypto trader who ran the bank's digital assets team since 2018, according to reporting by CNBC.

McDermott, who is based in London, is a managing director who ran Goldman's internal funding operations. He joined in 2005 from Morgan Stanley.

“In the next five to 10 years, you could see a financial system where all assets and liabilities are native to a blockchain, with all transactions natively happening on chain,” McDermott commented. “So what you’re doing today in the physical world, you just do digitally, creating huge efficiencies - and that can be debt issuances, securitisation, loan origination; essentially you’ll have a digital financial markets ecosystem, the options are pretty vast.”

McDermott has been given permission to double his team's headcount with hires in Asia and Europe, with JPMorgan Chase’s head of digital assets strategy Oli Harris the most recent appointment.

Harris was involved in JPM Coin, the first digital coin from a major bank, which was unveiled last year. He was also a vice president in charge of Quorum, the blockchain platform that underpins the JPM Coin.

Speaking to CNBC, McDermott said it is crucial to build consensus with other banks, institutional investors and regulators. He hinted at the possibility of collaboration with JPMorgan in helping to develop a Goldman coin.

“We are exploring the commercial viability of creating our own fiat digital token, but it’s early days as we continue to work through the potential use cases.”

He concluded: “We’ve definitely seen an uptick in interest across some of our institutional clients who are exploring how they can participate in this space - it definitely feels like there is a resurgence of interest in cryptocurrencies.”

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