JPMorgan Chase CEO Jamie Dimon showed strong support for decentralized finance and blockchain technology in a recent letter to shareholders. His new take appears to be a 180 from his previous take on crypto, and is more in line with his company.
Blockchain and DeFi are ‘real’
The letter, released yesterday, discussed a range of topics such as the geopolitical climate, the macroeconomic situation, the changing competitive landscape and the company’s investments. When covering the latter, Dimon noted that JPMorgan has invested in modernizing the business over the past five years, “to compete with both banks and fintech companies”.
Among its new innovations is JPM Coin – a US dollar-backed stablecoin designed for use by large businesses in 2019. It provides both “account verification” and “programmable payments” to the bank.
Stablecoin trading on the blockchain LIINK – launched in 2017 – is used by over 400 financial institutions to date.
“Decentralized finance and blockchain are real, new technologies that can be deployed, allowed or not, both public and private,” Dimon wrote. “JP Morgan Chase is at the forefront of this innovation.”
In fact, there is a growing interest in non-permissive and even non-financial blockchains. The United States Government Accountability Office released an assessment last month that covered the pros and cons of using blockchain in pharmaceutical supply chains, and for the issuance of digital IDs.
Similarly, the CEO of JP Morgan believes that “there are many uses where a blockchain can replace or improve contracts, data ownership, and other enhancements.” That said, there are still some use cases for which it is “currently too expensive or too slow to deploy.”
Dimon also acknowledged that competition from fintech is “intensifying”, and contributing to the declining role of banks in the global financial system.
no mention of bitcoin
Despite his optimism about blockchain, Dimon explicitly made no mention of bitcoin, which he never had enthusiasm for. He referred to the property as “worthless”, and even called on investors to stay away from it.
However, the CEO admitted last October that some of his customers disagreed with him. As such, he has stated that he is willing to provide investment options for the bitcoin lovers that his company serves.
Two months ago, the bank offered “long-term” bitcoin price predictions of up to $150,000.
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