Goldman Sachs Plans 24/7 Trading for Tokenized Treasuries
1min read Goldman Sachs is exploring the possibility of introducing 24/7 trading for tokenized Treasuries and money market fund shares in the US. This initiative was announced by Mathew McDermott, the head of digital assets at goldman sachs, during the TOKEN2049 event in Dubai. The move is part of a broader strategy to integrate traditional collateral into blockchain infrastructure, driven by increasing client demand for on-chain exposure.
The firm has already established a crypto derivatives desk and is planning to launch three tokenization projects by 2025. These projects include the first U.S. fund tokenization and a euro-denominated digital bond. The tokenized money market funds sector has already surpassed $1 billion in assets under management, with projections suggesting it could expand to $2 trillion by 2030. Early liquidity in this sector is being provided by offerings from blackrock, Franklin Templeton, and various Web3 firms, creating opportunities for tokenized collateral to support more flexible and continuous settlement cycles.
Tokenized Treasuries have also seen significant growth, surpassing $5 billion, with BlackRock’s BUIDL leading the way. This growth is supported by recent policy developments that have removed major regulatory hurdles. The Office of the Comptroller of the Currency’s Interpretive Letter 1183, issued in March, allows national banks to conduct crypto custody, stablecoin operations, and distributed ledger settlements without prior approval. Additionally, the Federal Reserve, FDIC, and OCC collectively withdrew previous 2023 guidance discouraging crypto activity, aligning U.S. rules with global jurisdictions and part of broader deregulatory efforts.
Goldman Sachs is also considering spinning off its Digital Asset Platform (GS DAP) into a separate entity. This initiative aims to allow the platform to serve multiple institutions, improving efficiency and accelerating liquidity, which is essential for the secondary trading of tokenized Treasuries and other assets. However, challenges remain. Goldman continues to favor permissioned blockchains to meet compliance requirements, and bank custodians still face regulatory capital requirements tied to on-chain holdings under SEC guidance. Liquidity in tokenized bonds remains limited, suggesting that secondary markets will require time to mature.
The bank’s roadmap positions it to introduce tokenized government debt products that can be traded outside standard market hours. This approach reflects an effort to meet evolving institutional demand and align blockchain integration with traditional market mechanics. The initiative underscores Goldman Sachs' commitment to leveraging blockchain technology to enhance the efficiency and accessibility of financial markets, positioning the firm at the forefront of innovation in the financial services industry.
