Maybe the fact that Bitcoin is prepping to become a major market player and a valid alternative to fiat currencies, pushed J.P. Morgan’s CEO Jamie Dimon on Tuesday (Jan. 10) to publicly refine his stance on the popular cryptocurrency.
Back in October, and almost a month after he first called Bitcoin a fraud, Dimon took aim at the cryptocurrency investors, saying that “if you’re stupid enough to buy it, you’ll pay the price for it one day.”
“It’s just not a real thing, eventually it will be closed,” Dimon said during an appearance on CNBC last year.
But JP Morgan’s top man seems to have changed his position about the world’s most popular cryptocurrency. In a wide-ranging interview with FOX Business Network’s Maria Bartiromo, Bitcoin’s most high-profile critic took back last year’s statements, saying that there is true value in the blockchain – the technology that underpins bitcoin – and he regrets calling it a fraud.
“The blockchain is real,” Dimon said during the interview. “The bitcoin was always to me what the governments are going to feel about bitcoin when it gets really big. And I just have a different opinion than other people.”
After cutting out of the interview with Dimon, Bartiromo said that Dimon told her his daughter bought Bitcoin at $11. Dimon has acknowledged the crypto could hit $100,000 per unit.
In 2017 Bitcoin spiked, printing an all time high of $20,000 per unit. However, just days before Xmas the cryptocurrency took a nosedive, trading below $14,000. At the beginning of last year, the price of a Bitcoin was below $1,000.
Newer cryptos like Etherium and Ripple’s XRP are threatening Bitcoin’s dominance with tons of cash from Main Street to Wall Street continuing to be invested in the entire sector. In fact, digital asset exchange company Coinbase now has more users than brokerage firm Charles Schwab (NYSE:SCHW). The massive growth of the cryptocurrency market has also attracted the interest of Dimon’s own bank.
J.P. Morgan (NYSE:JPM) announced in October it will be launching its own blockchain-powered network to facilitate global payments. Investment banking giant Goldman Sachs (NYSE:GS) is also exploring ways in which it can meet client demand for access to cryptos. They plan to have a cryptocurrency trading desk up and running by the end of June, if not earlier. The increased demand for cryptos has also attracted The Chicago Board Options Exchange (CBOE) and Chicago Mercantile Exchange (CME), the world’s largest futures exchange. Both exchanges launched Bitcoin futures contract in December.
The launch of Bitcoin futures could pave the way for the listing of the first ETF linked to Bitcoin. If SEC approved, the creation of an exchange-traded-fund will not only bring more liquidity into the bitcoin market, but will also be a step toward establishing the crypto as a legitimate asset class. In fact, Bitcoin, whose price has soared roughly 1,500% since the start of 2017, has outperformed every other asset over the past five years and this may continue to be the case into 2020. Yes, the arguments that current gains are similar to the famous Great Tulip bubble of 1637, and that they have been driven by irrational mentality that is characteristic in speculative bubbles, would have some merit, but only if Bitcoin starts hovering above the $200K level.
Another thing worth noting is that the just mentioned arguments are only for those who perhaps purposely downplay the significance of blockchain technology which inarguably at this point represents the next and now irreversible logical stage of the information revolution.
The price of Bitcoin declined to $13,200 Thursday (Jan. 11), according to data from Cryptocompare.com. While there’s been a few sharp dips, Bitcoin’s rise has been nothing short of phenomenal. In 2011, the crypto once traded at less than a buck.