Daniel Pinto, Co-Chairman and COO of the multinational investment bank JP Morgan, shared the attitude of the company’s management towards cryptocurrencies.
In an interview with CNBC, he confirmed that if Bitcoin and other blockchain assets do become widespread, the bank will have no choice but to join the burgeoning digital asset industry. Accordingly, coin lovers can count on the bank in the future.
Note that the relationship of this bank with cryptocurrencies is quite contradictory. Initially, JP Morgan became popular among the blockchain community thanks to the statements of its leader, James Dimon, who promised to fire any employee who invested in Bitcoin.
A little later – in January 2019 – the bank’s analysts predicted a fall in the BTC rate to $ 1,260 within a few years. According to them, the financial system itself is unlikely to experience any benefits due to the emergence of blockchain technology.
However, at the end of 2020, the situation changed completely. Then JP Morgan began testing its own digital coin called JPM Coin, which was intended for cross-border payments. Well, now the giant’s employees even admit a direct connection between the company and cryptocurrencies.
Banks are beginning to love Bitcoin
Here is one of Pinto’s quotes during an interview on the channel, in which he shared the details of what is happening. The cue is from Decrypt.
If and when cryptocurrencies become a widely used asset class, JP Morgan will have no choice but to participate in the development of the market. There is no demand for crypto from clients yet, but I am sure that someday it will be.
That is, the expert assumes that in the future, among the bank’s clients, there will be those who want to invest in cryptocurrency, and this will be done with the help of a financial institution. We believe that the likelihood of this is really high. Still, Tesla’s announcement of an investment of $ 1.5 billion in Bitcoin last week will do its job: attitudes towards cryptocurrency – especially among critics of blockchain assets – are now seriously changing. This means that there will be much more new investors.
Large banks are still very reluctant to accept Bitcoin because it is considered too speculative an asset. However, JP Morgan traders look at the charts of the cryptocurrency and «really want to profit from its volatility and price spikes.» This was announced at a recent internal meeting of the bank.
According to CNBC correspondent Hugh Sung, the tone of the discussion at JP Morgan has changed dramatically from previous years. As we have already noted, back in 2017, the head of the bank, Jamie Dimon, called Bitcoin a «scam» and in every possible way rejected ideas about the potential growth of the cryptocurrency. Obviously, then Daimon was fundamentally wrong, and now JP Morgan has to reckon with the new realities of the market.
In addition, Pinto added that when JP Morgan finally decides to enter the crypto market, he will use cryptocurrency exchanges that the bank is «comfortable» with. It will most likely be the largest US marketplace, Coinbase.
It is noteworthy that JP Morgan can actually already indirectly make money on the growth of Bitcoin, being one of the shareholders of Tesla, a company that invested $ 1.5 billion in BTC the day before.
And while Bitcoin acquires completely unexpected allies, one of its longtime supporters leaves the cryptosphere for good. We are talking about the writer Nassim Nicholas Taleb, who is widely known for his book «Black Swan» and has long advocated the mass adoption of cryptocurrencies. At the end of last week, he unexpectedly announced on his Twitter that Bitcoin cannot be considered a currency due to its large price fluctuations and is itself a «failure.»
As one of the reasons for the «failure» of the cryptocurrency, the writer mentioned the fact that due to sharp changes in the exchange rate, people cannot evaluate goods in BTC. At the same time, in April 2020, he quoted tweets from other users and directly advised the use of blockchain coins that are able to protect against censorship and provide other undeniable advantages of decentralization.
So far, however, the Bitcoin chart speaks against criticism. Yesterday, the main cryptocurrency set a new all-time high at $ 49.5 thousand and is gaining new supporters not only in individual banks, but also on most of Wall Street. Is this not a new financial revolution?
We believe that the statement by JP Morgan representatives to some extent reflects the common position of old critics of the blockchain industry and cryptocurrencies in general. If the demand for the latter from customers is too high, companies will have no choice – and they will also begin to interact with Bitcoin, Ethereum and other projects.
Hence, we can conclude that previous statements about «lack of prospects for cryptocurrencies» mean nothing. And if banks see an opportunity to make money in connection with cryptovolts, they will do it. Old remarks will not interfere with them in any way.
