Leading global banks including Goldman Sachs, Morgan Stanley, Citigroup and Barclays have quietly retreated from Bitcoin initiatives during the bear market of 2018, according to a Bloomberg report. Daniel Gallancy, the CEO of SolidX, which hopes to launch a Bitcoin ETF in the US, said: "The market had unrealistic expectations that Goldman or any of its peers could suddenly start a Bitcoin trading business. That was top-of-the-market-hype thinking."

Bloomberg's reporting indicates that Goldman Sachs has only 20 clients for its flagship non-deliverable forward (NDF) bitcoin product. It was earlier reported that Goldman invested in BitGo, the crypto custody firm. Despite making employees available for a large New York Times profile on Bitcoin trading in May 2018, the firm has not yet begun trading bitcoin or any other cryptocurrency.

Meanwhile, Morgan Stanley, which has been prepared to offer swaps tracking Bitcoin futures for months, has yet to trade even one contract. Citigroup has similarly left all of the cryptocurrency trading products it designed on the shelf. The two leaders of Barclays digital assets group, hired earlier this year, have already left the firm. And Barclays currently has no plans to build a crypto trading desk.

Bloomberg's sources as well as insiders The Block has spoken with cite a lack of institutional client interest as well as a lack of regulatory clarity as key reasons that cryptocurrency products have yet to take off on Wall Street. At the same time, institutional bulls point out that significant infrastructure is being built by large companies such as the NYSE, Fidelity, TD Ameritrade and the Wall Street banks themselves. 

If and when institutional demand does begin to pick up, the infrastructure will be in place to support numerous Bitcoin and cryptocurrency-related financial products.