Goldman Sachs Submits DeFi ETF Application to SEC

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In Brief
  • Goldman Sachs submits application for a DeFi ETF.

  • The ETF will focus on DeFi and blockchain equity.

  • Like all other ETFs, Goldman Sachs notes that there are inherent risks in investing in the ETF.

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Goldman Sachs has filed an application for a decentralized finance (DeFi) exchange-traded fund (ETF) with the U.S. SEC. The ETF will track an index that measures the performance of companies from across the world.

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Multinational investment bank Goldman Sachs has submitted an ETF registration application with the United States Securities and Exchange Commission (SEC). The ETF focuses on DeFi and blockchain equity, according to the filing documents.

The objective of the fund is to invest at least 80% of its assets in securities, which are included in the underlying index. The ETF would primarily expose investors to companies in the DeFi space. The specific companies are those from Australia, Canada, France, Germany, Hong Kong, Japan, South Korea, Switzerland, the Netherlands, the United Kingdom, and the United States.

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The filing reads,

“The Goldman Sachs Innovate DeFi and Blockchain Equity ETF (the ‘Fund’) seeks to provide investment results that closely correspond, before fees and expenses, to the performance of the Solactive Decentralized Finance and Blockchain Index (the ‘Index’).”

The move is one of the few that Goldman Sachs has taken to enter the crypto market. It began trading bitcoin futures in June and will offer Ethereum futures and options as well.

Like all other ETFs, Goldman Sachs notes that there are inherent risks in investing in the product. Namely, that the crypto market is volatile. All ETF applications make a note of this concern, but they are marching ahead with the applications, hoping that the SEC will see that the benefits outweigh any potential risk.

The SEC is already well aware of these risks, as it has rejected applications many times in the past and is currently sitting on over a dozen submissions.

Goldman Sachs joins list of ETF applicants

The SEC is reviewing over 12 applications at the moment, with the most prominent being the VanEck Bitcoin ETF and WisdomTree Bitcoin ETF. It has been highly cautious about approving an application, citing investor protection and market manipulation as the two key concerns.

SEC Chairman Gary Gensler and others have hinted at a potential regulatory framework, which would likely precede an approval. The SEC has already delayed various applications multiple times, and the increasing volume will likely result in an announcement in the months to come.

An approval would likely offer a more legitimate avenue for investors, who might otherwise have to use other less regulated platforms.

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Rahul's cryptocurrency journey first began in 2014. With a postgraduate degree in finance, he was among the few that first recognized the sheer untapped potential of decentralized technologies. Since then, he has guided a number of startups to navigate the complex digital marketing and media outreach landscapes. His work has even influenced distinguished cryptocurrency exchanges and DeFi platforms worth millions of dollars.

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