Goldman Sachs Brings $100B Treasury Fund to Crypto’s Institutional Rails

Jennifer Sanasie (0:00)

On today's Public Keys from the New York Stock Exchange, Goldman Sachs, Flagship Treasury Fund is now available on the Digital Asset Settlement Network. The new CEO of Twenty One Capital on his plan for one of the largest Bitcoin Treasuries in public markets. And Bastion just got a National Trust Bank Charter from the OCC. I'm Jen Sanasie, let's get into it.

Happy Monday everyone, we are breaking some news this morning on Public Keys. Lynq is announcing the Goldman Sachs Bank-Chip Treasury Fund, Ftixx, is now available on its platform. Ftixx manages roughly $100 billion in assets and is one of the largest government money market funds in existence. It's the first external asset manager on the Lynq network and it means institutions can now hold an investment-grade instrument and earn yield on cash positions directly inside their settlement workflow. Jerald David is the CEO of Lynq and he joins us now. Congratulations on the launch.

Jerald David (0:53)

Thanks, Jen, we're super excited. Great to be with you today.

Jennifer Sanasie (0:55)

All right, set a foundation for us. Talk to me about what this means for Goldman Sachs' Ftixx to be available on Lynq.

Jerald David (1:02)

Yeah, this is super exciting for us. I think it really demonstrates two things. The first is that, you know, the Lynq platform itself now is multi-asset capable. I think that's something we had thought about long ago when we developed the technology in the platform. We created a multi-asset platform, and we're really excited that Ftixx, Goldman Sachs' flagship treasury fund, is the second asset now available for institutional clients.

Jennifer Sanasie (1:23)

Now, talk to us a little bit about the mechanics here, because this isn't a tokenized fund, correct?

Jerald David (1:27)

Right, it's not.

Jennifer Sanasie (1:28)

So talk to us a little bit about what this enables that wasn't able to be enabled before.

Jerald David (1:33)

Yeah, of course. I think this is meaningful for a couple of reasons. First of all, it's meaningful because this product is being distributed through T-Zero securities on the Lynq network. So I think there's a convergence now that you're seeing between traditional market participants and digital asset market participants as well. The other thing I think is meaningful about this is that the technology that we've created now is able to sustain a fund of that size, a fund of that magnitude where you've got over 100 billion dollars in AUM in it.

Jennifer Sanasie (1:58)

Take us inside the conversations you're having with Goldman Sachs to get this across the line. What kinds of questions were you answering? And how long was that process?

Jerald David (2:08)

Yeah, I mean I think there are a couple of things there. I mean the first is that we needed to demonstrate that there was client demand. And I think that our clients were looking for a treasury asset on the platform that may have had a different yield profile than the other instrument that's on there right now. I think the second part of that really was trying to ensure for an asset manager like Goldman Sachs, GSAM, that we do have the right precautions, risk in place as well. We had to retrofit our technology. We've ring fenced the actual offering now to ensure that it's only for US clients. And we also had to integrate with Mosaic. So it was quite a lift on our side as well. But the end output of that is obviously great. Now is clients have a choice. And there's a Goldman Sachs fund that's on the platform as well.

Jennifer Sanasie (2:46)

Let's talk about client demand. Who's the client for this? Tell me a little bit more about what they were asking for.

Jerald David (2:51)

Yeah, so at Lynq, we're building a network. And the network itself was originally established by a couple of core participants. There was TZero, the broker-dealer partner, and then obviously ARCA, the asset manager, was in there as well. But the clients that we built the platform with and for are B2C2, Wintermute, Galaxy, FalconX, crypto.com, Fireblocks, and others. And it was very clear from our discussions with they and the other 40 or so institutional clients that are on the platform that having a treasury management fund specifically that could handle large amounts of assets that would be able to deliver a yield through a regulated instrument was something that they wanted. We were able to work with Goldman Sachs. We were able to satisfy their requirements. And now we're really happy to have their fund as our second fund on the platform.

Jennifer Sanasie (3:34)

Take us into the mechanics a little bit more. Talk to me about what happens to the yield the moment that that trade settles.