Goldman Sachs offers Bitcoin derivatives to investors

Goldman Sachs is offering investors non-deliverable forwards (NDFs), derivatives tied to the price of bitcoin that pay out in cash, according to Bloomberg. CoinDesk contacted the investment bank to confirm the news.

• Goldman will then buy and sell bitcoin futures in block trades through the Chicago Mercantile Exchange, using Cumberland DRW as its trading partner, to protect itself from volatility.

• NDF is a futures contract where the parties settle the difference between the NDF agreed price or rate and the spot price or rate at a notional agreed amount.

• In January, the Chicago Mercantile Exchange topped the list of the world’s largest bitcoin futures trading platforms, indicating a continued rise in institutional participation.

• In March, Goldman Sachs relaunched its cryptocurrency trading desk after a three-year hiatus and plans to once again support bitcoin futures trading.
• Goldman Sachs quietly began offering bitcoin derivatives contracts to clients last month as part of a test of its hedging approach, a person familiar with the matter told CoinDesk.