JPMorgan CEO Jamie Dimon: Crypto is a ‘decentralized Ponzi scheme’

JPMorgan CEO Jamie Dimon: Crypto is a ‘decentralized Ponzi scheme’

Cryptocurrencies are harmful “Ponzi schemes” that put billions of {dollars} in danger annually, JPMorgan CEO Jamie Dimon declared in a scathing assessment of risky digital belongings.

In his testimony earlier than Congress on Wednesday, Dimon referred to himself as “a giant skeptic” about cryptocurrencies like Bitcoin.

“They’re decentralized Ponzi schemes, and the notion that it is good for anybody is unbelievable,” he informed lawmakers, calling Bitcoin and different cryptocurrencies “harmful.”

Bitcoin, hovering round $19,000 at 6:45 a.m. ET on Thursday, has misplaced greater than half its worth in 2022 as cryptocurrencies normally suffered a widespread sell-off generally known as the “crypto winter.”

home assembly

The US Home of Representatives Monetary Companies Committee held a listening to on Wednesday by which representatives from main US banks, together with Citigroup, Financial institution of America and Wells Fargo, gave testimony. Committee Chair Maxine Waters and Rating Member Patrick McHenry are at the moment creating a invoice on the regulation of stablecoins, a digital asset class that’s pegged to the worth of an asset such because the US greenback.

In accordance with the latest draft of the invoice, seen by Bloomberg, it could be unlawful to difficulty or create new “endogenously collateralized stablecoins” like TerraUSD, which collapsed earlier this yr in one of many largest cryptocurrency crashes in historical past.

Dimon mentioned in his Home testimony on Wednesday that billions of {dollars} have been misplaced annually to cryptocurrencies, noting its hyperlinks to cash laundering, ransomware, intercourse trafficking and theft.

Nevertheless, he argued that stablecoins wouldn’t be as problematic in the event that they have been correctly regulated.

Bitcoin ‘nugatory’

The JPMorgan boss has lengthy been a vocal critic of Bitcoin and different decentralized digital belongings, refusing to confer with them as currencies.

In October of final yr, when the worth of Bitcoin was approaching an all-time excessive, Dimon mentioned that the cryptocurrency was “nugatory”.

In 2017, he referred to Bitcoin as a “fraud,” a press release he later mentioned he regretted. Final yr, nevertheless, he doubled down on his aversion to the asset, saying he was “not a fan of Bitcoin” and “had no real interest in it.”

JPMorgan itself has not been as crucial of Bitcoin, with the financial institution saying in Might that it noticed a “vital upside” for crypto buyers. Nevertheless, the lender’s head of funds mentioned this week that whereas the cryptocurrency had a “area of interest use case,” demand for tokens as a cost methodology had fallen sharply during the last six months.

The agency and Dimon himself have additionally been supporters of Blockchain know-how, which is the muse of cryptocurrencies like Bitcoin.

In 2019, JPMorgan grew to become the primary US financial institution to efficiently create and take a look at a digital foreign money that represents fiat foreign money, on this case the US greenback. Blockchain-enabled JPM Coin is utilized by the financial institution to make intraday repurchase agreements.

Join the traits of fortune e-mail checklist so you do not miss out on our largest options, unique interviews and investigations.

Leave a Reply

Your email address will not be published.