Banks such as Goldman will not touch cryptocurrency spot markets but lean towards synthetic crypto products such as futures. Emulating tri-party repo type arrangements (a way of borrowing funds by selling securities with an agreement to repurchase them, involving a third-party agent), banks are exploring ways to follow the same path of not touching bitcoin, like other synthetic products.
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Goldman Sachs, Other Wall Street banks Exploring bitcoin-backed loans
“Goldman was working on getting approved for lending against collateral and tri-party repo,” said one of the people. “And if they had a liquidation agent, then they were just doing secured lending without ever having bitcoin touch their balance sheet.”
