Goldman Sachs CEO David Solomon has disclosed in a French newspaper that the company is doing extensive research on tokenization.
In interview with French newspaper Les Echos on June 27th, CEO David Solomon claimed that the group may eventually take part in the crypto disruption of finance.
He further said the bank could absolutely follow JPMorgan Chase in launching a cryptocurrency. Hence the bank’s carrying out extensive research on asset tokenization as well as stablecoins.
When asked about potential involvement with Facebook’s Libra cryptocurrency project, the CEO declined to comment on the matter. However, he said he found the concept rather interesting. He further added that tokenization and stablecoins are the direction in which the payment system will go.
Notably, when asked whether Goldman Sachs will follow JPMorgan Chase in launching its own virtual currency, Solomon stated:
“Assume that all major financial institutions around the world are looking at the potential of tokenization, stablecoins and frictionless payments.”
Nonetheless, he believes it’s too early to say which platform might ultimately win out.
As for crypto regulation, Solomon predicted that regulations will change in response to virtual currencies given that regulators around the world are carefully observing payment flows. However, he doesn’t think new players in the crypto space will cause banks to close. He added:
“Admittedly, they will have to evolve, because the trades linked to the payment flows will become less profitable. But there are many other reasons why banks must remain innovative, otherwise they will disappear.”
Solomon has pointed out as well that tech giants such as Facebook would like to avoid the regulatory constraints that banks face, making it more likely that they would try to enter into partnerships rather than become financial institutions themselves.
Meanwhile, earlier this week reports suggested that JPMorgan Chase is set to begin piloting its own cryptocurrency by the end of this year.
Dubbed the JPM Coin, it will initially run on top of Quorum – the private version of Ethereum the bank developed in conjunction with EthLab – and could be used to settle a fraction of transactions between clients of its wholesale payments business in near real time. The bank revealed earlier that it is currently starting trials of the coin with clients.