Goldman Sachs to Separate Blockchain-Based Platform From Digital Assets Business

Goldman Sachs plans to spin out GS DAP, its blockchain-based platform for participants in digital capital markets, from its Digital Assets business.

The financial institution plans to explore strategic opportunities to do so with the aim of GS DAP becoming an industry-owned distributed technology solution, it said in a Monday (Nov. 18) press release.

“Delivering a distributed technology solution to a wide cross-section of financial market participants has the potential to redefine market connectivity, infrastructure composability, and to deliver a new suite of commercial opportunities for the buy- and sell-side,” Matthew McDermott, global head of digital assets at Goldman Sachs, said in the release. “We view this as an important next step for our industry as we continue to build out our digital asset offerings for our clients.”

Goldman Sachs will continue to scale its Digital Assets business and advance its platform’s technology capabilities, according to the release.

The financial institution also said in the release that its first partner for the platform — TradeWeb — will work with Goldman Sachs to help bring new commercial use cases to GS DAP by including its trading and liquidity capabilities across the fixed-income spectrum.

“Our goal is to create and utilize a solution that ushers in a new wave of access, liquidity and interoperability for the digital financial markets, introducing new capabilities to the marketplace that advance market structure and connectivity,” TradeWeb Chief Product Officer Chris Bruner said in the release.

Goldman Sachs was among three dozen participants in a pilot project completed in March that looked to reframe assumptions about the use of blockchain-based applications within traditional finance.

The project, called the Canton Network, brought together 15 asset managers, 13 banks, four custodians, three exchanges and stablecoin issuer Paxos Trust Co. to explore the potential of a privacy-enabled open blockchain network allowing for real-time settlement and immediate reconciliation across counterparty systems.

The project proved that the blockchain could be used to streamline and synchronize financial applications while at the same time adhering to regulatory asset control, security and data privacy requirements, PYMNTS reported at the time.