Bitcoin The Cryptocurrency, Is 'Worthless'

Jamie Dimon
CEO of JPMorgan Chase

Banks, the financial institutions that accept deposits while simultaneously making loans, have history that can be traced back to money lending systems for merchants.

Around 2,000 BC in Assyria, India and Sumeria, the first prototypes of banks were created to give grain loans to farmers and traders who carried goods between cities. Later, the ancient Greece further developed the idea during the Roman Empire, in which lenders were based in temples to accept deposits and perform the change of money.

Ancient China also had a similar idea.

Later, the method was further developed and improvised in order to indirectly affect capital markets, as well as providing security for the people involved.

Since then, banks become financial institutions that play an important role in financial stability and the economy of a country, as most jurisdictions exercise a high degree of regulation over banks.

In the U.S., JPMorgan Chase is among the largest.

And Jamie Dimon as its boss, likened Bitcoin the cryptocurrency to smoking cigarettes.

Jamie Dimon

"I personally think that Bitcoin is worthless," Dimon said while speaking at a virtual event hosted by the Institute of International Finance. "But I don't want to be a spokesman for that, I don't care. It makes no difference to me."

"I don't think you should smoke cigarettes either," the CEO continued before conceding.

"Our clients are adults. They disagree. If they want to have access to buy or sell Bitcoin – we can't custody it – but we can give them legitimate, as clean as possible access."

As the CEO of one of the largest financial institutions, Dimon is no fan of Satoshi Nakamoto's creation.

Dimon has been a vocal critic of Bitcoin, previously calling it a "fraud," and at one point said that he would fire JPMorgan traders if they traded in it.

He also said that Bitcoin has “no intrinsic value.”

Although he thinks Bitcoin will be around long term, “I’ve always believed it’ll be made illegal someplace, like China made it illegal, so I think it’s a little bit of fool’s gold.”

But regardless, Dimon acknowledges the market's demand for the cryptocurrency, and that Bitcoin is already a trillion-dollar market, and that is considered among the best investment of the decade.

This is why Dimon said that "regulators are going to regulate the hell out of it,” especially since anxiety around stablecoins and the asset class more broadly has been growing.

“Blockchain can be real, stablecoins can be real,” Dimon said, adding that “no matter what anyone in the room thinks, nor what any libertarian thinks, nor what anyone thinks about it, government’s going to regulate it.”

This is in line with what some financial experts have said.

They suggested that if people want cryptocurrency to become more of a mainstream asset, regulation is probably the best step.

However, cryptocurrency supporters are wary of further regulation — they worry that certain regulatory framework may stifle cryptocurrency innovation and hinders some businesses overseas.

While for his part, Dimon holds his anti-cryptocurrency opinion, JPMorgan has begun offering its clients access to a number cryptocurrency products. The company has also created a unit for its blockchain projects, and even started giving its wealth management clients access to cryptocurrency funds.