Interview: Former Trader Hits Goldman Sachs ‘Misleading Information Crypto Market Manipulation’
A former foreign exchange trader criticized Goldman Sachs for allegedly spreading misinformation that caused confusion in the crypto market that resulted to its crash.
A former foreign exchange trader hit Goldman Sachs over its alleged “untrue reports” of announcing plans to roll out a Bitcoin trading desk only to pull back on its decision, saying this shows the mindset and ease of manipulation in the cryptocurrency market.
In an interview with Cryptovest, Garen Ovsepyan, a former hedge fund manager who shifted to digital currency, said the market reaction to the Goldman Sachs news could have been better handled by better liquidity from better-suited cryptocurrencies.
He stated, “Goldman Sachs, just like many of its Institutional counterparts, will most likely enter and participate in any market where the retail market is bleeding, and profusely bleeding we are in the crypto markets right now. Over the 15 or so years that I traded, I never read a report or market analysis from institutions that either never panned out, or they were simply touting their own book for their own benefit. We used to almost always take the opposite side of Goldman recommendations in FX and I could comfortably say that 80% of the time, these trades were winners.”
Ovsepyan advised that when the markets hear that any institution is doing this or that, they should not let the “FUD” (fear, uncertainty and doubt) take over and not get emotional about their own holdings and remind themselves that they are still at the ground floor of the cryptocurrency evolution.
Business Insider reported last week that Goldman Sachs was laying aside its plans to set up a Bitcoin trading desk. Goldman Sachs has since denied the news.
Ovsepyan continued, “sell the rumor or buy the news is an age-old thing when it comes to trading in general or in this case, keep selling the news, and its effect on the crypto markets is not any different than other markets that are traded.”
The big difference, he said, is the volatility involved as it seems as if the crypto markets are far more susceptible to such news because of the delicate situation the industry is in right now. The delicate situation is the bear market the digital currency sector has been in since the January highs when cryptomania was at its most euphoric stage.
“Then ‘this’ happened and everyone lost a lot of money because of the fear of missing out and mind-boggling gains some made,” he added.
“Now that the euphoria is gone,” he said, “those who are left with any holdings, altcoins in particular, are looking for anything and everything to help move the market in their favor only because they are in extreme losing positions. These are solely selfish and monetary reasons where not long ago, all the crypto buffs wanted Wall Street and institutions to stay away, that was then, this is now.”
“We must remember that some of these projects people invested in are long-term investments that will take two to three years to complete and perhaps another two to three years to gain any traction and adoption, just look at the dApps market and the daily users they each have, none of these companies going through traditional fundraising would have the market valuations they had at the highs, nor the valuation they have in the current market,” he continued.
Ovsepyan, is now working on Thalr, which he claims world's first cryptocurrency with true intrinsic value that allows for the unbanked to be banked in a global and borderless fashion, noted the market reaction to also highlighted the fact the industry does not have a safe haven cryptocurrency other than Bitcoin.
“Bitcoin will be the safe haven cryptocurrency until something else comes along that can provide for better value and perhaps a true intrinsic value, but for now, cash, whether USD, EUR or JPY, will be king when everyone is heading for the exits,” he added.
He explained the idea of cryptocurrencies is to decouple itself from Wall Street and institutions like Goldman Sachs and others alike. Cryptocurrencies are meant to be borderless and decentralized and not be tied to what institutions like Goldman do, or what any other entity or person says or does.
“So then why is it now that the crypto market cares what Wall Street or Goldman does or does not do? Even the BTC ETF rejections were taken as a negative for the crypto market where it should actually be great news it was rejected! The fact is that the more decoupled we are from these institutions or any other naysayers of cryptocurrencies, the further ahead we’ll get with instilling cryptocurrencies as a unit of measure in the future.”