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Goldman Sachs explores creating a digital coin like JPMorgan’s

Bloomberg NewsbyBloomberg News
June 28, 2019
in Payments, Strategy
Reading Time: 1 min read
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David Solomon may take a leaf out of Jamie Dimon’s book by exploring a digital coin for payments.

Goldman Sachs Group’s chief executive officer told France’s Les Echos newspaper that he’s “absolutely’’ looking at digital currencies and said Goldman is conducting “extensive research’’ on tokenization, the process for transforming currencies or assets into tradeable digital contracts that live on a blockchain.

“Assume that all major financial institutions around the world are looking at the potential of tokenization, stable coins and frictionless payments,’’ said Solomon.

JPMorgan Chase & Co. said in February it developed its own stable coin, JPM Coin, for its clients to use in cross-border payments. Facebook Inc. this month unveiled a new coin for payments called Libra which it plans to launch next year.

Solomon declined to comment on whether Goldman Sachs has had discussions with Facebook. He said blockchain-based stable coins tied to real currencies are “the direction in which the payment system will go.’’

Libra is the latest example of how tech companies including Apple Inc. and Amazon.com Inc. have ventured into the financial industry. Still, Solomon said the tech giants will more likely seek to partner with banks than challenge them directly, citing Goldman’s credit-card partnership with Apple as an example.

“Do you believe that the tech giants, who have other concerns for the moment, want to submit to the same regulatory constraints as JPMorgan or Goldman Sachs?’’ said Solomon. “Of course, these companies have a lot of customers and will certainly try to monetize them. It seems to me, however, that they will try to seal partnerships with banks rather than become banks themselves.’’

Tags: BlockchainBloombergdigital currencyGoldman SachsJ.P. Morgan (JPM)
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