Now JP Morgan likes cryptocurrency

21.Feb.2019Editorial

Article published in “Milano Finanza” on February 21, 2019

Bitcoin «is a scam» and «will end up blowing up». On September 14, 2017 Milano Finanza reported the prophecy of doom (which did not happen) by Jamie Dimon, president and CEO of the American banking giant J.P. Morgan. A year and a half later we are talking about a different story. Dimon, who promised to fire even a single trader “guilty” of having invested in the digital currency, today is the head of the first American institute to launch its own cryptocurrency. Even the wolves of Wall Street, in short, change their mind.

The JPM Coin, based on blockchain technology similarly to the bitcoin, is a stablecoin anchored to the U.S. dollar designed for «the instantaneous transfer of payments between institutional accounts» and reserved for the B2B market. In fact, the bank has to specify: «We don’t have plans to make this available to individuals at this stage». However, there is no doubt that the cost-savings and efficiency benefits would extend to the end customers of the institutional clients.

For better or worse, everything that happens in the United States has an impact all over the world. It is expected that the decision of J.P. Morgan will turn into a wave that will invade the global market and, at that moment, will no longer be possible to postpone the regulation of the sector. A framework shared by all actors (governments, institutions and companies) would also allow individuals to operate and benefit. The simplification of daily operations such as exchanges and banking transactions would have the effect of revitalizing an economy that is struggling to take off, especially in some sectors. Automobiles (with 4.6 percent decrease in registrations last month compared to January 2018 in Europe), Real Estate transactions and mortgages above all. When you buy a car or a house you can wait several weeks: a limbo in which the contractors are not protected at all stages. Thanks to Smart Contract, you have the solution at hand.

Consulcesi Tech believed in financial technology a long time before Jamie Dimon. In fact, the hi-tech company serve sas lead advisor of ConsulCoin Cryptocurrency Fund, the first EU regulated investment fund for institutional investors active in the crypto and blockchain market.

As we said, the shock due to J.P. Morgan’s decision will have consequences in the whole finance industry. With the emergence of new players, annual transactions exceeded over $ 100 trillion. A large number of transactions that is strengthening the relationship between banks and customers, to whom fast, secure and transparent e-banking services must be provided. In a closer than you expected future, online money transfers will be carried out mainly in cryptocurrencies, not for nothing Facebook is developing a stablecoin for the payments on the platform. Mike Novogratz (formerly Goldman Sachs and founder of the Galaxy Digital – an investment firm focused on digital assets and blockchain technology) recently has defined bitcoin as a “sovereign digital gold”, overcoming the national currencies.

In the Anglo-Saxon world all this can be summed up in one adjective: “disruptive”. The old paradigms are now crumbling, while the future is in full construction.