The financial heavyweight Goldman Sachs is hoping to launch an exchange-traded fund (ETF) that tracks public firms, one way or another working in the blockchain-related sphere. The ETF would track an index but its composition (and the firm’s definition of DeFi) has seen much derision aimed its way, amid no shortage of confusion.
The drama began yesterday when Goldman Sachs filed an application with the American Securities and Exchange Commission (SEC). The filing did not go into specifics on the kind of firms it would track, instead detailing that the fund’s managers would invest at least 80% of its assets into companies that advance blockchain technology and the “digitization of finance.”
However, it did include details about how the ETF will “[seek] to provide investment results that closely correspond, before fees and expenses, to the performance of the Solactive Decentralized Finance and Blockchain Index.”
Solactive is a Frankfurt-based financial indices provider.
The proposed ETF, officially called the Goldman Sachs Innovate DeFi and Blockchain Equity ETF is “not sponsored, promoted, sold or supported in any other manner by Solactive,” Goldman Sachs noted in a disclaimer section, where it also referred to the Solactive Decentralized Finance and Blockchain Index as the “Solactive Index.”
However, it appears that in their search for the elusive index in question, confusion took hold among crypto community members who were trying to figure out what the Solactive Decentralized Finance and Blockchain Index actually is. Eventually, some began to suspect that it could be what at first glance looks like a completely different index – the Solactive Blockchain Technology Performance Index.
The latter appears to be composed of global IT firms that have spent money on blockchain-related research – including the likes of Accenture, Nokia, the Google operator Alphabet, Mastercard and Sony.
Cryptonews.com reached out to the German firm for comment, and received the following reply:
“There is indeed a confusion here, the index Goldman Sachs was making reference to is not the Solactive Decentralized Finance and Blockchain Index but the Solactive Blockchain Technology Performance Index.”
Solactive confirmed that the 20-strong list comprising the likes of Nokia was indeed correct. Cryptonews.com has also contacted Goldman Sachs for comment.
Perhaps the key here is that DeFi could mean something different for the financial giant: namely digital finance. The key themes, it wrote in its filing are “the implementation of blockchain technology and the digitalization of finance.” The firm added:
“[The] digitalization of finance is defined as the digital transformation of traditional financial services, including the support and delivery of payments, transaction services, lending and insurance.”
On Twitter, Mark Jeffery, the co-founder of Guardian Circle, smarted:
“Of course, not one of the companies Goldman lists for their ‘DeFi ETF’ is actually a DeFi company or protocol. Is this fraud? It kind of feels like fraud.”
“How in the actual fuck does Nokia even qualify?”
There were more jokes on the Nokia front from other prominent crypto community members.
Cory Klippsten, the CEO of Swan Bitcoin, wrote that the Goldman Sachs “ETF” was “not even close” to a DeFi index and that its “plan” was “to mimic [an] index of large public company tech stocks, adding:
“Sorry DeFi scammers, no Goldman Parachute! Gonna have to stick to ripping off crypto traders!”