While the entire world is talking about the next big wave of “cryptocurrency” and how it is going to set the next big revolution in the financial markets, CEO of JP Morgan Jamie Dimon seems to think otherwise.
Earlier this week at the Delivering Alpha conference, Jamie expressed his strong views against Bitcoin and the overall concept of how cryptocurrencies operate. In his harsh criticism, Jamie said “It is worse than tulip bulbs” while referring to a famous market bubble from the 1600s. He further added that “The currency isn’t going to work. You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart.”
Bitcoin is a virtual currency that was first introduced in 2009. In past two years the cryptocurrency market has witnessed a lot of investor participation from all around the globe with many analysts predicting this to be the next big revolution in the financial markets.
Bitcoin and other crypto coins like Ethereum and Altcoins allow cross-border payments while bypassing the traditional banking system and allows one person to pay directly for the purchase of his/her’s goods and services. This makes Bitcoin a decentralised digital currency backed by Blockchain technology.
However, analysts have time-and-again raised questions of Bitcoins being used for some illegal activities like money laundering and online crime. Pointing to this, Jamie said “If you were in Venezuela or Ecuador or North Korea or a bunch of parts like that, or if you were a drug dealer, a murderer, stuff like that, you are better off doing it in bitcoin than US dollars. So there may be a market for that, but it would be a limited market.”
Jamie’s words were absorbed with quite a seriousness as the markets witnessed a huge sell-off immediately after the interview as the prices of Bitcoin plunged by nearly 6-8%. However, don’t mistaken this for the ongoing sell-off th...