The banking giant Goldman Sachs filed an application with the U.S. Securities and Exchange Commission (SEC) on July 26 for a DeFi ETF that would offer exposure to public companies. According to the filing, the proposed fund called the “Goldman Sachs Innovate DeFi and Blockchain Equity ETF” seeks to provide investment results that closely correspond to the Solactive DeFi and Blockchain Index performance from the German indices provider.
Goldman Sachs to offer ETF focused on securities of cryptocurrency-related companies.
At the moment, the details were thin on the ground, but the fund will invest at least 80% of its assets into securities, stocks, and fintech firms featured in the index. Goldman Sachs may be a little confused over the definition of “DeFi.” A closer look at the Solactive Index reveals that it comprises U.S. tech giants and international telecoms companies. Of the top twenty components in its July 23 report, not one of them could be described as a DeFi or blockchain project or organization. The top three were Nokia, Facebook, and Google’s Alphabet.
Goldman has been ramping up its cryptocurrency work in recent months.
Goldman Sachs is hoping to offer exposure to decentralized finance, which is one of crypto’s hottest growth areas. Defi-based apps allow for peer-to-peer lending, borrowing, and trading, and they hold a total of about $64.5 billion in funds, according to tracker DeFi Pulse. The other area of the ETF’s potential investment, blockchain, could include any companies that develop digital ledgers for applications like payments. Goldman has been ramping up its cryptocurrency work in recent months. It’s restarting its crypto trading desk to help clients like hedge funds deal in publicly traded futures tied to Bitcoin.