JPMorgan CEO calls crypto ‘decentralized Ponzi schemes’
In testimony before United States (US) lawmakers, JPMorgan Chase CEO Jamie Dimon referred to himself as a “major skeptic” of “crypto tokens that you call currencies like Bitcoin,” labeling himself a “decentralized Ponzi scheme.”
Dimon was asked during an oversight hearing held by the House Financial Services Committee on September 21 what kept him from becoming more active in the crypto space.
Dimon emphasized that he sees value in blockchain, decentralized finance (DeFi), ledgers, smart contracts, and “tokens that do anything,” but then moved on to crypto tokens identified as currencies.
Asked for his thoughts on the draft US stablecoin bill, Dimon said he believes there is nothing wrong with properly regulated stablecoins and that money market funds should be subject to similar regulations.
Dimon once described Bitcoin as a “fraud” and in the past has stated that he has no interest in supporting the sector on a personal level. He has softened his stance on crypto on occasion, once highlighting that it can serve important use cases such as cross-border payments.
Despite Dimon’s view of the cryptocurrency space, JPMorgan is pushing into the blockchain technology space. The financial giant launched its own in-house stablecoin — JPM Coin in October 2020 — the first cryptocurrency backed by a US bank, with the aim of increasing settlement efficiency.
A week after launching the coin, the bank launched a new business division dedicated to blockchain technology called Onyx. Since then the Onyx platform has been used by large institutional customers for round-the-clock global payments.
JPMorgan became the first major bank in the metaverse after opening a virtual lounge in the blockchain-based World Decentraland in February. The move follows a report released by the firm that cited the metaverse as a $1 trillion opportunity.
JPMorgan is hiring new staff to move forward in the blockchain and crypto space, recently announcing on September 9 that it hired former Microsoft executive Tahrim Kamptom to become its senior payments executive. His Linkedin bio shows that he has worked on crypto-related payment systems and is expected to help JPMorgan explore blockchain technology.
Related: ‘Most crypto is still junk’ and lacks use cases – JPMorgan blockchain head
During the hearing, lawmakers asked other top US bank CEOs if they had plans to finance crypto mining. Citigroup CEO Jane Fraser, Bank of America CEO Brian Moynihan, and Wells Fargo CEO Charles Scharf all suggested their banks had no intention of doing so.