Goldman Sachs’ asset management division plans to launch its first cryptocurrency exchange-traded fund in the coming months, according to a Tuesday filing with the U.S. Securities and Exchange Commission.
The bank unveiled its ETF, designed to offer exposure to bitcoin’s price as well as to generate income from bitcoin options transactions, only days after rival Morgan Stanley launched its own spot bitcoin fund, the Morgan Stanley Bitcoin Trust ETF.
The banks are launching products in a difficult environment for cryptocurrency investments. Cryptocurrency has fallen in recent months amid weakening risk sentiment driven in part by volatility in precious metals, a broad selloff in tech shares, and the U.S.-Israeli war with Iran.
“The addition of (options) income to the product can be nice, but this could be a hard sell, given the volatility and the fact that the product will still leave investors with downside exposure,” said Bryan Armour, ETF analyst at Morningstar, referring to the Goldman product.
The filing did not disclose the proposed fee for the new ETF, which could launch at the end of June.
The price of bitcoin, the world’s largest cryptocurrency, has tumbled nearly 15% so far this year to $74,591. It currently trades 40% below its all-time high of $126,223 reached in October.
Assets under management for cryptocurrency ETFs continue to grow, but the trajectory has been slower and bumpier. Both the Grayscale Bitcoin Covered Call ETF and the Global X Bitcoin Covered Call ETF recorded net outflows in the last three months, ETF.com data shows.
A spokesperson for Goldman Sachs Asset Management declined to comment on the filing.
The new ETF is the first Goldman has filed since completing its US$2 billion acquisition of ETF provider Innovator Capital Management earlier this month. Innovator was a pioneer in developing ETFs using options to determine outcomes or generate income, and launched the first U.S. buffer ETFs in 2018.
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