“S**t f**k, I agree with Nouriel,” said one cryptocurrency enthusiast in reference to NYU economist and vocal bitcoin bear Nouriel Roubini.
Agreeing with Nouriel Roubini for a cryptocurrency lover was an unbelievable thing. The global economist called bitcoin “a mother of all scams and bubbles” before the US senators. He wrote elaborative anti-cryptocurrency reviews for mainstream media. He celebrated when the prices of leading top coins fell drastically. In short, no cryptocurrency supporter should have agreed with the “Dr. Doom.”
Not unless JP Morgan came into the picture.
The American multinational bank on Thursday announced that it had created “JPM Coin,” an XRP-like digital token that would instantly settle transactions between its clients. Since the coin utilized blockchain, the digital ledger technology that powers major cryptocurrency projects, media started referring JPM Coin as ‘crypto.’
In a FAQ published after the JPM Coin announcement, JP Morgan clarified that its new asset was a stablecoin, which means it is 1:1 redeemable in fiat currency held by the bank. Atop that, the firm stated that it was using a permissioned blockchain network, adding that only institutional customers passing JP Morgan KYC standards would gain access to it.
Roubini was quick to tweet about how JP Morgan stablecoin was not a cryptocurrency. He wrote:
“In which way has the new alleged JPMorgan crypto-coin anything to do with blockchain/crypto. It is private not public, permissioned not permissionless, based on trusted authorities verifying transaction not trustless, centralized not decentralized. Calling it crypto is a joke.”
Breaking down the tweet, what Roubini highlighted was how JPM Coin would not move beyond the walls of JP Morgan. Had it been bitcoin or any other decentralized asset, the network would process transactions anytime, to anywhere. However, the coin could replace Swift, a decade-old system which takes more than a day to settle money transfers. With JPM Coin, JP Morgan would be able to execute the same transactions in real-time.
Roubini’s tweet marked the first time when he and the rest of the cryptocurrency community thought in the same direction. But that does not mean he was projecting bitcoin as a better alternative than JP Coin. Let’s see why:
A section of cryptocurrency enthusiasts believed that JP Coin, a project backed by the same bank whose CEO Jamie Dimon called bitcoin a fraud, could now project the decentralized digital currency in good lights. To them, a big bank experimenting with bitcoin-as-a-technology was a piece of bullish news in the long term.
Nevertheless, Roubini’s tweet appeared like an attempt to separate decentralized assets from an institutionally-backed stablecoin. Not that it could have harmed bitcoin, it would disappoint buyers who believed the digital currency could benefit from the JP Morgan announcement.
Dr. Doom is not buying JP Morgan ‘cryptocurrency,’ but it doesn’t mean he is bashing it for existing. At the same time, the economist is not giving up on speaking against bitcoin on public platforms.