J.P. Morgan, who’s CEO Jamie Dimon previously called Bitcoin “a fraud” and would “fire a trader in a second” for dealing in Bitcoin will now be pursuing Quorum, an enterprise version of Ethereum.
Quorum’s chief goal is to enable the operation of smart contracts and will start with “tokenised gold bars to allow sustainable miners to earn a premium on global markets”. J.P. Morgan’s head of blockchain initiatives, Umar Farooq, said that they “are the only financial player that owns the entire stack, from the application to the protocol”.
The article cited that “JP Morgan and Credit Suisse are members of the Enterprise Ethereum Alliance, which is developing standards for the technology”. Umar Farooq also highlighted that since they are apart of the Ethereum network, they can benefit from upgrades and tap the development community.“We are all building private networks but there is a long-term thought process of what happens when you get to a point where you need to do private-public convergence – a connection –and at that point, if you are in some ways a derivative of a public platform, it could become easier”.
Growing interest in blockchains highlights importance of open-source access
Even though this is a 180 degree turn for J.P. Morgan from earlier statements, it is not the first time that a large institutional bank has signaled interest in blockchain technology. Fidelity has launched its own custody account and has taken a 15% stake in Neptune Dash, the publicly traded fractional Dash Masternode ownership company. Then HSBC India and ING Bank Belgium reportedly made one of the first blockchain-based trade transaction platforms. Banks are increasingly finding security and cost advantages to integrating blockchain technology into their operations.
However, this growing interest is also a warning to the importance of open-source access and decentralization. While it can be difficult for any system to be trustless since...