JPMorgan's Dimon blasts Bitcoin as 'worthless', due for regulation

https://www.reuters.com/business/jpmorgans-dimon-blasts-bitcoin-worthless-due-regulation-2021-10-11/

by dev_tty01 • 5 years ago

46 84 5 years ago

I am not always crypto advocate but how can any person take this seriously, what a massive conflict of interest we have here. If I ran some large business I probably also would say some potential competitor was worthless and due for regulation. Maybe bitcoin is not a competitor, but maybe it is, and maybe some other "fintech" or "defi" is a future competitor, if Dimon tar Bitcoin as a bad scam tech now and get these regulations he is stopping future competition before it becomes any problem.

pm902• 5 years ago

Why is it a conflict of interest? He’s not running the SEC.

nvr219• 5 years ago

Because it's in JPMorgan's best interest to not have bitcoin be a thing.

gruez• 5 years ago

Presumably because a decentralized finance system would strip incumbents like JPMorgan of their advantage (eg. regulatory capture).

randomhodler843• 5 years ago

It’s not a security. Bitcoin makes banks obsolete. Private Bankers and Central Bankers are quaking in their boots over Bitcoin. It undoes their damage. They are not longer needed.

aynyc• 5 years ago

Because JPM is a middleman, crypto removes middle man. Like all the car dealerships use legal means to prevent Tesla to sell cars directly to consumers without local shops.

bpodgursky• 5 years ago

Crypto is so worthless that we need to heavily regulate it to make sure it does not become too valuable.

frankbreetz• 5 years ago

I think heavily regulated before many people invest there retirement accounts and are then "the last fools in" and are left with nothing.

Wouldn't things have been better for the middle class if the real estate industry was more heavily regulated in 2008?

medo-bear2• 5 years ago

maybe jpmorgan and friends are also due for some regulation :)

social_quotient• 5 years ago

Interesting how often they break the rules, unrelated to crypto

https://www.corporatecomplianceinsights.com/banks-15b-in-fin...

https://www.marketwatch.com/amp/story/banks-have-been-fined-...

EugeneG8• 5 years ago

JPMorgan and friends are so hyperregulated they literally have regulators who sit in their offices, company officers who are required to report to regulators on a whim, regular scheduled updates with regulators, audits, etc. etc. there is probably no industry more regulated than finance.

medo-bear2• 5 years ago

my comment was downvoted so fast i thought i accidently posted on jpmorgan's chat board :)

gautamcgoel• 5 years ago

I recall that at the start of 2020, people were posting predictions for the next decade, and one guy predicted Bitcoin would reach $100k. In fact, he predicted it would reach $100k by the end of the year, IIRC. I take the opposite view; crypto mania will fizzle out in the next few years, leading to a corresponding decline in BTC and ETH prices. People bought crypto without belief in its intrinsic value or any intention of using it to buy goods, but rather because they hoped it's price would increase - the very definition of speculation.

x3sphere• 5 years ago

I mean that’s what happened in 2017-2018 yet again we are repeating the same bubble. I guess these crazy run ups will end at some point but I see no indication this will be the last.

mettamage4• 5 years ago

I don’t think it will be.

I talked to a person that valuates art. When I heard her talk, I felt that cryptocurrency valuation had a lot in common with it.

Where art is valued on:

- Rarity

- Popularity of artist

- Perceived craftsmanship then

- Perceived craftmanship now

- Emotional elicitation (indirectly, i.e. if we didn’t “like” or “felt” something through art it wouldn’t hold value, probably).

Now cryptocurrencies:

- Rarity

- Popularity

- Innovativeness of idea at the time

- Innovativeness of idea now

- The ideology that a certain coin or cryptocurrencies as a whole represent (e.g. if it didn’t have an anarchistic and innovative bend then it would be worth a lot less)

- To a small extent: its utility (e.g. the unbanked using it)

Obviously I am handwaving and simplifying. My point: they are more similar than you think.

mettamage4• 5 years ago

It’s not just speculation. It’s experimentation as well. The crypto community has been really playful in how they use and define money. There are wuite a few lessons that we have learned as a society that otherwise wouldn’t be so salient.

Things like:

What is trust?

Should we put our trust in technology instead of people?

Can we build a blockchain vm?

Can you censor blockchain technology? Or will people find ways around it?

Bitcoin will always hold some lower bound value, because there will always be 2.1 million willing to use $10 to see what happens.

Governments aren’t playful, people are. Playfulness can lead to recklessness and pain. It can also lead to artistic expression and innovation. IMO with cryptocurrencies, you see both.

mrjin• 5 years ago

Well, there was not such a thing as intrinsic value in neither cryptos nor in any fiats. Fiats at least are backed by the governments. For cryptos, there is nothing backing them nor would anyone really believe in them. The only potential value is to speculate. They claim to have resolved centralization issue but ironically people speculate cryptos in centralized exchanges. Centralization in financial areas are there for a reason, it just cannot be resolved by decentralization and that why people need crypto exchanges.

As a matter of fact, lots of regulations are on the way, and some countries go further even try to criminalize them, which will accelerate the decline for sure. Myself actually tried to speculate BTC in late 2008 or early 2009 which I cannot remember exactly, as I was pretty sure people were going to speculate in it. It was shame that I was too early, the price was super low ($0.001 or might be $0.01) but there was no venue for me to buy any. The next time BTC returned to my sight was around 2017, the price went up to $1000. I chilled out thought those people were crazy. But it turned out they were actually much crazier than I speculated. I look forward to seeing how this drama is going to end.

angelzen• 5 years ago

I used to think the same way, but I now I believe BTC is here to stay. There is too much uncertainty in the mainstream monetary system. A bout of hyperinflation and everybody is wiped out. People are desperately looking for alternative value stores, even if imperfect.

m0zg2• 5 years ago

If Jamie doesn't like it, I like it even more. At a first approximation, whatever is bad for JPMorgans and Goldman Sachs' of the world, has a high probability of being good for the rest of us.

robotsteve2• 5 years ago

You need more than a first approximation.

EugeneG8• 5 years ago

And it's a crappy first approximation at that! "Banks are evil because I heard that banks are evil and I don't really understand what they do."

wanderinghogan• 5 years ago

At this point I am interested in pretty much anyone's perspective other than his. He bashes crypto, he makes money, his company builds something using crypto, he makes money. Just like his bank he is too big to fail and serves no one's interest but his own.

paulpauper3• 5 years ago

His opinions are overrated imho.I don't think bitcoin will be worthless but I think there are far better investments though.

caymanjim• 5 years ago

He may be uninformed or outright wrong about Bitcoin, but he runs the largest investment bank in the world. A whole lot of people care what he thinks about financial matters, and even if he's wrong about Bitcoin, the fact that he holds that opinion is important in itself.

SparkyMcUnicorn• 5 years ago

I don't share this viewpoint.

Politicians and bankers (almost all on the older side) have no clue what they're talking about when it comes to technology, and come to terrible conclusions all the time.

boplicity• 5 years ago

Several years ago, the discussion around cryptocurrency often centered on the valuable uses it could have. Now that it's been around for quite some time, how are people using it, in terms of useful functionality?

I know very little about the subject, but my initial thoughts lead to things like ransonware payments, money laundering, etc. Certainly there are other useful ways that people regularly use cryptocurrency. What are they?

randomhodler843• 5 years ago

International remittance without needing to pay the traditional gatekeepers a cut.

bhouston• 5 years ago

AKA Money laundering and tax avoidance.

EugeneG8• 5 years ago

why pay a traditional gatekeeper when you can pay a nontraditional gatekeeper and make it generally more convoluted

CheezeIt• 5 years ago

It’s served me well to be able to hold money when stocks seem really high, without being coerced by inflationary policy to throw more money into a bloated stock market by our political masters.

mettamage4• 5 years ago

Alternative form of money transfer (large sums).

El Salvador is experimenting.

Alternative form of payment on some sites (haven’t needed it yet)

ufo• 5 years ago

I'm not convinced that the population of El Salvador is into it to the same degree that Nayib Bukele is. The whole thing sounds very fishy.

fieldcny5• 5 years ago

Why would you pay for something with any crypto, no one wants to be the next guy to pay a billion dollars for a couple pizzas.

tmcw2• 5 years ago

I assume you've been filing form 8300 with the IRS for those transfers over 10k in value, right?

Right?

paul_f• 5 years ago

Cryptocurrency has three successful use cases. One is speculation, hoping to profit from coin value increasing over time. Two is enabling nefarious activity such as ransomware payoffs and buying illicit drugs, weapons, illegal pornography, etc. Three is money laundering.

EugeneG8• 5 years ago

I think "Digital Gold" is a legit use case, similar to "regular gold"

Though it's not a very satisfying use case because it's like "hold bitcoin because we all agree we should hold bitcoin"

pennaMan2• 5 years ago

In your view, what are the use cases of regular money?

xkfm2• 5 years ago

It's kind of frustrating because I don't know a single person (besides myself) who uses crypto for anything but investing. Maybe one person because they bought an NFT (also for investment).

I felt like games/fantasy sports/betting would have come online by now. But, actually using crypto to buy anything is usually a convoluted process.

For betting and fantasy sports, you have better options. Most the games are still fumbling around/obvious vaporware. Your best bet is probably Axie Infinity, and it's not very fun, and also hard to play for free. Also, 80% of the people playing these games are using them for income streams, so they get min-maxed to hell, and there is even more botting than usual.

All of these altcoins, even bitcoin to a degree, are all barely usable unless you're letting them sit on an exchange somewhere.

I've had a good experience purchasing a good or service with exactly one altcoin.

Even all the DeFi stuff you hear about in articles/podcasts is too complicated, or you're going to have to pay $500 in gas fees to do anything.

It's pretty obvious most of the people who are "into" crypto, aren't really doing anything with it besides honing their investment skills once you actually talk to them about what they do with it.

EugeneG8• 5 years ago

What do you use it for other than investing?

berberous• 5 years ago

The exorbitant gas fees should be largely resolved by L2s and other L1 scaling solutions. I am a huge crypto bull, but that is based in part on my belief that those scaling issues will be solved over the next couple years. I don't think anybody believes that crypto will be successful if those scaling issues are not addressed.

jonahbenton2• 5 years ago

Yes, the criminal uses are dominating the non-criminal, but the non-criminal continue to mature.

The way to think about it is that crypto is reinventing all of the historical aspects and nuances both of money and also of public systems of record- both of which are millenia old- on a much faster timeline.

There are orders of magnitude more people alive and participating in this money/ledger maturation process than all the previous times put together, of course. Much of the learning is just being implemented, rather than discovered. (Many of the mistakes, however, are being rediscovered.) So it is going very fast, but there is still a LOT to cover.

I would posit the system of record use cases are much more profound than the money use cases. Those are still years away- we don't really know how far- but it appears to me the infrastructure is still on track to have a role there.

In response to a question- in X years will there be jurisdictions using public blockchains for, eg Real Property ledger, rather than the mix of paper and digital non-blockchain systems variously in use now- I would say yes, and put greater than 50% odds that X is less than 10.

Real Property ledger is much more important than money. You can use any old thing for money, but in any civilization there is only one Real Property ledger.

hakfoo2• 5 years ago

I think I'd be more willing to bite on the "record keeping" concepts, if you can come up with ones where decentralization is a meaningful feature.

The big selling point of blockchain is trustless decentralization. How does decentralization improve a property registry? There's a finite amount of land, most of which has a fairly clear paper trail. The existing paper trail has well established legal credentials that any replacement system would have to re-create.

I guess the vision is that if you had immutable records of changes, it would self-resolve ownership disputes. I suspect the vast majority of such disputes aren't about "did he file deed A or B, and when" and more informal "the property line was only vaguely defined" or "we're trying to understand a will written in 1855 without context" situations that may not resolve to a document, and probably require a judge, not an algorithm, to decide.

In a general sense-- supply chain tracking, ownership tracking-- there's usually a single or small cluster of of "end consumers" of the data being stored. For supply chain integrity, it's the end consumer/manufacturer who needs to be able to produce a report saying his cocoa is Fair Trade Certifiable. For land ownership, it's the local taxation and legal system who needs to know who to send the bills to. They become the obvious steward of a centralized record system.

A centralized system also allows for sensible gatekeeping to prevent misuse of the system. I can imagine a blockchain land registry letting people develop a software package to play Monopoly with real land, while a traditional centralized county recorder would probably start penalizing you for filing frivolous documents before you got to the green properties.

thoughtstheseus• 5 years ago

They’ve wasted a decade of innovation in us financial services. Crypto does little

pennaMan2• 5 years ago

Someone who is not me regularly buys LSD with monero for what it's worth and the shopping experience is almost Amazon level, next day shipping included.

agumonkey• 5 years ago

The timing of news is really funny.

The 'negative news on bull run, positive news on crash' legend seems strong.

paulpauper3• 5 years ago

"due for regulation"

It's already very , very heavily regulated. I remember in 2010 trading on etrade or ameritrade was a simple as filling out the form and wiring money, but with cryptooo there are tons of security checks, ID checks, verification, screening, blaocchain analysis to do anything.

fieldcny5• 5 years ago

I can tell you haven’t worked in a regulated industry, there is almost no regulation.

Most of the stuff you list is simple stuff done to meet KYC rules that most exchanges were initially delinquent in implementing and only did so when it was pointed out the obvious liability they were taking on not implementing them.

For regulated securities products there are all sort of approvals needed from the product itself to the marketing materials. There are rules about suitability of the product, transparency over commissions and fees, licensing and registration of market participants, market data rules.

That’s all just the tip of the iceberg.

paulpauper3• 5 years ago

this does not refute my personal experience. took me 3 days to trade on ameritrade, and I could withdraw $ in days too. Coinbase req.photo ID tons of other stuff to withdraw crypto. way different.

Most of the stuff you list is simple stuff done to meet KYC rules that most exchanges were initially delinquent in implementing and only did so when it was pointed out the obvious liability they were taking on not implementing them.

That is my point. they were. not anymore.

greesil• 5 years ago

It clearly wasn't worthless for the early adopters.

bla15e• 5 years ago

Bitcoin blasts JPMorgan's Dimon as 'worthless', due for regulation

mnaei• 5 years ago

Here is one perspective on Bitcion: In a world where abundance is abundant (every day we have more cash, cars, etc..) scarcity by itself could manifest value. As per law of supply and demand.

craigc2• 5 years ago

Gotta love when the Hacker News crowd sides with Wall Street kingpin Jamie Dimon just to own Bitcoin. This guy became a billionaire thanks to taxpayer subsidized bailouts after the 2008 crisis while regular people lost their homes, and while I don’t know that it is proven, it is very likely he was personally involved with or at the very least aware about the subprime mortgage derivative schemes that set off the entire thing.

spinchange2• 5 years ago

Actual misinformation. Dimon's bank was one of the strongest ones and wasn't making or wholesaling subprime mortgages. It was able to acquire Bear Stearns for less than the value of Bear's real estate owned.

craigc2• 5 years ago

Misinformation? What do you mean? One of the strongest ones? You mean they didn’t lose a lot of money as a result of the collapse? That is exactly my point. They were financing the lenders and offloading their own bad securities in secret while not touching the ones held by their OWN CUSTOMERS. Aka they KNEW the whole thing was a scam and knew the whole thing was going to implode and didn’t want to be caught holding the bag when it did. They still got bailed out along with everyone else.

Here are a couple sources if you are curious:

- https://www.rollingstone.com/politics/politics-news/the-9-bi...

- https://thedailybanter.com/2015/06/jp-morgan-ceo-who-stole-b...

Ice_cream_suit• 5 years ago

Bitcoin is important to a global industry worth around 2.8 trillion USD.

"A comparatively simple crime-economic model, constructed from readily available international databases, closely predicts a range of such expert assessments, and appears to offer a framework for determining and monitoring the size of money laundering flows around the world. Further research is required to complete the model, but the nature of that research is made clear, and it appears that existing data sources are likely to be adequate.

Initial output from the model suggests a global money laundering total of $2.85 trillion per year, heavily concentrated in Europe and North America."

http://www.johnwalkercrimetrendsanalysis.com.au/ML%20method....

1ark• 5 years ago

Relevant history: "Dimon's many takes on Bitcoin"

https://www.reddit.com/r/CryptoCurrency/comments/9t140h/jami...

https://finance.yahoo.com/news/jamie-dimons-own-bank-cryptoc...

https://www.businessinsider.com/jpmorgan-financial-advisors-...

naveen99• 5 years ago

The people who benefit from bitcoin and who have a usecase for bitcoin (self custody of billions) are beyond regulation.

JPMorgan's Dimon blasts Bitcoin as 'worthless', due for regulation

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