Goldman Sachs has significantly increased its investments in Bitcoin ($BTC) and Ethereum ($ETH), according to its latest 13F filing with the US Securities and Exchange Commission (SEC).
The report, covering the fourth quarter of 2024, shows that the bank has more than doubled its holdings in Bitcoin-related exchange-traded funds (ETFs) and made a massive move into Ethereum investments.
This shift suggests a growing institutional interest in cryptocurrency despite past skepticism from Goldman Sachs’ leadership.
Goldman Sachs has been steadily increasing its exposure to Bitcoin, and the latest SEC filing confirms this trend. The bank now holds approximately $1.58 billion worth of Bitcoin ETFs, marking a sharp rise from the $710 million reported in the previous quarter.
This increase highlights the bank’s growing interest in the leading cryptocurrency despite its CEO’s previous doubts.
The largest portion of Goldman’s Bitcoin investment is in BlackRock’s iShares Bitcoin Trust (IBIT). The bank now owns 24.07 million shares of IBIT, worth approximately $1.27 billion.
This represents an 88% increase compared to the third quarter of 2024, when Goldman held 12.7 million shares worth $461 million. This rise suggests that the bank sees Bitcoin as a valuable asset and is willing to expand its holdings significantly.
Goldman Sachs has also increased its holdings in Fidelity’s Wise Origin Bitcoin Trust (FBTC). The bank now owns 3.53 million shares in FBTC, valued at $288 million. This marks a 105% increase from the previous quarter.
However, the bank has significantly reduced its holdings in Grayscale Bitcoin Trust (GBTC), cutting its position by 97%. This move could indicate a strategic shift towards Bitcoin ETFs managed by industry giants such as BlackRock and Fidelity.
Another important detail in the filing is Goldman Sachs’ involvement in options trading. The report shows that the bank holds $760 million in options related to Bitcoin ETFs.
This includes an IBIT call position valued at $157 million, an IBIT put position worth $527 million, and an FBTC put position of $84 million.
These options trades suggest that Goldman is managing its risk while taking advantage of Bitcoin’s price movements.
Strategic shift in crypto investments
Goldman Sachs has made noticeable adjustments to its cryptocurrency investment strategy. The bank has exited several smaller Bitcoin ETF positions, including those in ARK 21Shares’ ARKB, Bitwise’s BITB, Grayscale’s mini Bitcoin trust, Invesco Galaxy’s BTCO, and WisdomTree’s BTCW.
Instead, Goldman is focusing its investments on funds managed by BlackRock and Fidelity, two of the most well-established names in asset management.
This change in approach indicates that Goldman Sachs is consolidating its cryptocurrency investments rather than spreading them across multiple funds.
By focusing on ETFs from larger firms, the bank may be looking for more stability and better performance from its Bitcoin-related investments.
Despite its increasing exposure to Bitcoin, Goldman Sachs has not always been supportive of cryptocurrency. Company CEO, David Solomon, has expressed skepticism about Bitcoin in the past, describing it as a speculative asset rather than a serious financial instrument.
In a recent interview, he reiterated this position, stating, “At the end of the day, I’m a big believer in the US dollar. Bitcoin is a speculative asset”. However, Goldman Sachs’ latest investments suggest that the bank sees potential in Bitcoin, even if it remains cautious about the risks involved.
The growing presence of Bitcoin ETFs in its portfolio shows that the bank is responding to increasing institutional demand for digital assets.
Massive surge in Ethereum investments
While Bitcoin remains Goldman Sachs’ primary focus, the bank has also made a significant move into Ethereum ETFs.
The latest SEC filing shows that Goldman Sachs increased its Ethereum ETF holdings from just $22 million in the third quarter of 2024 to $476 million in the fourth quarter. This represents a staggering increase of more than 2,000%.
Goldman Sachs now holds $234.7 million in Ethereum through Fidelity’s Wise Origin Ethereum Trust (FETH) and $235.5 million through BlackRock’s iShares Ethereum Trust (ETHA). Additionally, the bank has a smaller $6.3 million investment in the Grayscale Ethereum Trust (ETHE).
The timing of these investments aligns with Ethereum’s price increase in late 2024. According to CoinGecko data, Ethereum’s price rose by 26.2% during the fourth quarter, contributing to the rising value of Goldman Sachs’ holdings.
This increase in investment suggests that the bank is beginning to see Ethereum as an important digital asset alongside Bitcoin.
Despite this surge in investment, Ethereum is still struggling to attract the same level of institutional interest as Bitcoin. Ethereum’s value relative to Bitcoin has declined by 13.8% in the past month, reaching a four-year low.
This suggests that while institutions are willing to invest in Ethereum, they still see Bitcoin as the dominant cryptocurrency in the market.
Institutional interest in crypto grows
Goldman Sachs’ growing investments in Bitcoin and Ethereum ETFs highlight a broader trend of increasing institutional interest in cryptocurrency.
The bank’s latest moves suggest that despite concerns about volatility and regulatory uncertainty, major financial institutions are recognizing the potential of digital assets.
This shift is also supported by a more crypto-friendly regulatory environment. The SEC’s approval of multiple Bitcoin ETFs in 2024 has made it easier for institutions to gain exposure to Bitcoin without directly buying the cryptocurrency.
This has encouraged more traditional financial players, including Goldman Sachs, to enter the market. However, Goldman Sachs’ leadership remains cautious. Some executives within the bank have previously dismissed cryptocurrency as an unreliable asset class.
Last year, Goldman’s Private Wealth Management Chief Investment Officer, Sharmin Mossavar-Rahmani, compared Bitcoin to the tulip mania of the 1600s, stating, “We do not think it is an investment asset class. We’re not believers in crypto”.
Despite these reservations, Goldman Sachs is clearly increasing its involvement in digital assets. In addition to its ETF investments, reports suggest that the bank is exploring blockchain-based trading solutions for its institutional clients.
This indicates that while Goldman Sachs may still be skeptical of cryptocurrency as a whole, it sees potential in blockchain technology and the financial products built around it.
