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JPMorgan CEO Denounces Bitcoin as Valueless, Citing Illicit Uses, Despite Firm’s Role in BlackRock’s Bitcoin ETF

Last Updated January 12, 2024 1:30 PM
Teuta Franjkovic
Last Updated January 12, 2024 1:30 PM

Key Takeaways

  • Jamie Dimon criticized Bitcoin, labeling it as valueless and a facilitator of criminal activities.
  • The JPMorgan CEO warned of a possible recession occurring within the year.
  • He highlighted that factors such as household finances, government debt, and international conflicts might adversely affect economic growth.

In his latest critique of Bitcoin, Jamie Dimon, CEO of JPMorgan, has reiterated his skepticism  towards the cryptocurrency. The bank chief coupled his concerns with a caution about a possible recession within the year.

Dimon said  the appeal of cryptocurrencies lies partly in their anonymous nature and the difficulty in tracing transactions.

Bitcoin Lacks Value and US Economy Faces Challenges

During an interview with Fox Business Network, Dimon said: 

“I’ve always said that Bitcoin doesn’t have value.”

He cited  its association with illicit activities such as sex trafficking, tax evasion, money laundering, and terrorism financing, emphasizing that its use extends beyond mere buying and selling.

“The actual use cases are sex trafficking, tax avoidance, anti-money laundering, terrorism financing; it’s not just people buying and selling bitcoin. There’s no value if you’re buying and selling Bitcoin.”

Jamie Dimon acknowledged  the current state of consumers, but he expressed skepticism about the ‘Goldilocks scenario.’ This refers to the optimism that the Federal Reserve’s interest rate hikes will effectively curb inflation without hampering economic growth.

Mixed Signals on Bitcoin: Skepticism Meets Profit Motive

Dimon has a history of criticizing Bitcoin. He previously labeled it a “hyped-up fraud ” and akin to a “pet rock .” Dimon has also called various crypto tokens “Ponzi schemes” and has advocated for governmental intervention to shut them down.

Despite his well-known skepticism towards cryptocurrencies, his firm, JPMorgan Chase, has actively participated in the development of cryptocurrency exchange-traded funds (ETFs). This is a stark contrast to Dimon’s personal views, which have led him to express his desire to curtail the growth of cryptocurrencies in the past.

BlackRock’s recent amendment to its SEC filing for its spot Bitcoin ETF proposal further highlights this dichotomy. The filing names both Jane Street Capital and JPMorgan Securities LLC as authorized participants, indicating JPMorgan’s growing role in the emerging cryptocurrency ETF sector.

The SEC’s approval of several ETF applications today underscores the increasing integration of cryptocurrencies into traditional financial systems, a trend that JPMorgan appears to be embracing despite Dimon’s reservations.

Dimon Warns of High Chances of Economic Recession

In his conversation with Fox Business, Dimon expressed a cautious outlook on the US economy . He noted that, while equity and credit markets are currently indicating a soft landing, buoyed by factors like historically low unemployment, wage growth, strong home prices, and enhanced access to credit, his stance remains guarded regarding the overall economic trajectory.

Dimon emphasized that a combination of various factors could potentially steer the economy towards a recession rather than a smooth transition, or ‘soft landing’. He specifically mentioned the current geopolitical tensions in Ukraine and the Middle East as significant risks. According to Dimon, both of these conflicts could have a widespread impact, influencing everything from oil, gas, and food prices to migration patterns and international economic relationships.

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