Having wanted to expand to be the first Wall Street firm to make markets in cryptocurrencies, Goldman Sachs has now withdrawn its plan to open a cryptocurrency trading desk.
Business Insider reports that because of the state of the regulatory environment within the industry being unclear, the Wall Street firm has paused any plans of opening a trading desk as it isn’t a “priority” anymore says an unknown source.
This has had a detrimental impact on cryptocurrencies with both Bitcoin and Ripple falling dramatically since Tuesday.
Already having a difficult 2018, Bitcoin looked promising having risen from £4,860 to £5,752 but all gains were nullified after the news from Goldman Sachs meant the leading cryptocurrency fell 15 per cent to £4,884. Similarly with Ripple having fallen nearly 10 per cent since Tuesday.
David Jones, chief market strategist at Capital.com, believes that this has been one of many false dawns when it comes to recovery. However, after major panic-selling by investors over the next few days, the prices are likely to level out with Bitcoin not falling much lower than £4,800 this year.
As Jones says, “this has been a reminder that the cryptocurrencies still are one of the more volatile and fickle assets out here”.