David Solomon, the CEO of Goldman Sachs is opposed to cryptos. He confirmed this recently in an opinion piece in the Wall Street Journal. His remarks have shortcomings, according to a reporter from Coin Desk, who decided to attack them.
Goldman Sachs CEO Vitriolizes Cryptos
On December 6, David Solomon, CEO of Goldman Sachs published a grandstand in the Wall Street Journal. In his text entitled “Blockchain Is Much More Than Crypto”, the banker said that the arrival of the blockchain has disrupted the entire chain of highly regulated economic values, in this case the banks. According to him, it is important to recognize that blockchain can support responsible innovation across the financial industry. But he dismissed the importance of crypto in the new economic revolution. He also called for strict regulation of cryptos.
For information, his article was published a few days after the bank’s announcement to invest “tens of millions of dollars” in cryptos, at discounted prices.
To defend his view on blockchain, Solomon revealed how Goldman Sachs used a private blockchain to arrange a two-year €100 million digital bond on behalf of the European Investment Bank.
He said the bond issue settled in 60 seconds instead of the usual five days. And to conclude that Goldamn Sachs will use a private blockchain to reduce settlement times. This should, he continues, reduce costs for all stakeholders.
Coin Desk’s response
In a document published on December 11, crypto journalist George Kaloudis of Coin Desk, has critical these words. For him, the banker, through this text, has “proven to be stuck in the past”. Kaloudis notably noted that the issuance of the bonds in five days is attributable to the fact of the bank. George Kaloudis also criticized the use of a private blockchain.
“If the bonds are settled in five days, it is not because of the absence of blockchain. But it’s because of Goldman Sachs. It’s because of regulations and bureaucracy. Adding a private blockchain is not going to rid Goldman Sachs’ bond placement process of regulation and bureaucratic red tape. Sure, adding a blockchain might be a solution, but in reality, it isn’t for one main reason. Private and permissioned blockchains are worse than useless”he wrote.
For the Coin Desk journalist, the ideas put forward by the number 1 of Goldman Sachs are retrograde. He objects to the fact that he has brushed aside the solutions that cryptos can provide. He also attacks the idea of imposing private blockchains as solutions to existing problems. “I can assure you of one thing: the best application will not come from the private, permissioned blockchains used to settle the bond placements of large multinational investment banks,” did he declare.
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