According to the Department of Justice of the United States, JPMorgan plead guilty to conspiring to manipulate the price of the U.S. dollar. In recent news, the JPMorgan CEO Jamie Dimon has publicly denounced Bitcoin as a “fraud.”
Dimon’s comments sent a lot of Bitcoin and cryptocurrency holders into a bit of a temporary panic.
What’s playing out here is a classic David vs. Goliath story (with a lot of attention seeking behavior from Dimon.)
For perspective, cryptocurrency ICOs (through Ethereum which Dimon did not mention) have recently set the venture capital industry ablaze. Bitcoin along other various cryptocurrencies and blockchain projects like Ripple are now gunning for banking.
Bitcoin is essentially an alternate way to store wealth. Bitcoin or a predecesor could one day entirely remove the need for banks. Banks understandly do not like it and are clearly not embracing it yet. Dimon, is the CEO of one of the biggest banks in the world. I’ll let you draw your own conclusion if you think that creates a bias and self fulfilling prophecy for him to “trash the competition” by calling it a fraud, without explanation.
Upon further investigation, I found out that JPMorgan itself had filed (175 times) for a “Bitcoin-Alternative” patent. It did not get the patent.
So it is clearly interested in the technology and want to make its own version.
After Dimon’s comments Bitcoin prices dropped by over $600 as of the time of writing. He also followed up his “fraud” statement by saying that Bitcoin could still reach as high as $100,000.
So let’s get this straight. JPMorgan plead guilty for manipulating the price of the U.S. dollar. Now, he publicly trashes another currency, a digital currency (Bitcoin) that subsequently set the market down (now starting to regain momentum back up due to the public starting to realize what’s going on.) And also said that it could reach as high as $100,000, which was only mentioned later by news sites and is helping it go back up.
Dimon having an extreme bias would be a nice way to put it.
Blockchain which quite simply is a better consensus algorithm and ledger than banks currently have, has the banking industry scared. Clearly, if a big CEO needs to come out and try to bully it around, he is scared.
In reality, it’s a last ditch attempt by the banking industry to try to stop cryptocurrency which has grown by over $100 billion dollars this year and has no end in sight.
Another interesting fact, JPMorgan which Jamie Dimon is the CEO of, is a public member of the Enterprise Ethereum Alliance. Ethereum has a cryptocurrency like Bitcoin called Ether, but more importantly has a platform to host decentralized apps. It’s essentially like the Microsoft Operating System of the blockchain space, and one day could be as popular and widely used as Microsoft Windows or Apple’s App Store. The platform allows developers to create decentralized apps. Ethereum however does not aim to take out banking, necessarily.
Ethereum is the 2nd most valuable cryptocurrency in the world in terms of overall market cap. We’ll see how this plays out from here. My guess is that this is the banking industries last ditch effort to stop something that could make them redundant.