KeyTakeaways:
- Goldman Sachs increases its Bitcoin ETF holdings to $1.57 billion in Q4.
- The bank’s Ethereum holdings rise to $476.5 million, marking significant growth.
- Options strategies provide Goldman Sachs with protection and potential profit opportunities.
Goldman Sachs has raised its exposure to Bitcoin ETFs, increasing its holdings by 120% during the fourth quarter of 2024. The bank’s crypto ETF investments now total $2.05 billion, reflecting growing institutional demand as market conditions shift. This boost follows a notable increase in its Bitcoin ETF positions, which now account for $1.57 billion.
A major portion of Goldman Sachs’ Bitcoin holdings is in BlackRock’s iShares Bitcoin Trust (IBIT), where the firm now holds 24.07 million shares worth $1.27 billion. This marks an 88% increase in the shares it holds compared to the previous filing. Furthermore, the bank has expanded its portfolio with Grayscale’s Bitcoin Trust (GBTC), now holding $3.6 million in shares.
Options Strategy for Risk Management
Alongside its Bitcoin investments, Goldman Sachs has taken a defensive position with various options. The bank holds a $527 million put position and an $84 million put through IBIT and FBTC, respectively.
Additionally, it has a $157 million call option through IBIT, which allows it to hedge against potential market downturns while maintaining a chance for gains if prices continue to rise.
Ethereum Exposure Also on the Rise
Goldman Sachs has also increased its Ethereum holdings, bringing its total exposure to $476.5 million by the end of Q4. This is a sharp increase from the $25.1 million held in the previous quarter. The bank’s Ethereum assets are divided between Fidelity’s FETH ($234.7 million) and BlackRock’s ETHA ($235.5 million), marking a diversification within its digital asset strategy.
Market dynamics partly drive the rise in Bitcoin and Ethereum holdings. Bitcoin’s price increased 40.6% from the start to the end of Q4, while Ethereum’s price rose by 26.2% during the same period. Despite these gains, Bitcoin continues to dominate institutional interest, with Ethereum’s value relative to Bitcoin recently falling to a four-year low.
