JP Morgan Analysts Dismiss Value in Crypto, Hold Out Hope For Blockchain

JP Morgan’s ambivalence regarding blockchain technology and cryptocurrencies is quite well-known but its recent opinion seems to be particularly negative towards these interrelated industries. On Thursday, analysts from JP Morgan expressed the opinion that the inherent value of cryptocurrencies remains to be proven in the market and that blockchain tech, regardless of the wide press it has been receiving, will take years to succeed.

The comments about blockchain made particularly in relation to the banking system as the analysts felt that the technology will have little to no bearing on banks and traditional financial institutions over at least the next 3 or about 5 years.

The comments made by the analysts of this finance giant highlight how sceptical the Goliaths of traditional finance still are towards crypto. However, they were comparatively much less dismissive towards blockchain. In saying that blockchain will not prove useful in the short-term period of 3 to 5 years, their comments still hold out hope that the technology may indeed transform and revolutionise the world, sooner or later. The analysts did acknowledge the many use case possibilities associated with blockchain.

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Of course, crypto enthusiasts cannot possibly crunch too many numbers to hit back at the JP Morgan analysts. That is because Bitcoin and other cryptocurrencies have proved to be rather disappointing almost entirely through 2018, showing negligible signs of a strong recovery or a robust bull run in 2019. After the investors and crypto enthusiasts celebrated the dream run of crypto back in December 2017, the road has only led downhill.

As JP Morgan analysts said, they had very little faith in the basic value of these cryptocurrencies, and found it hard to trust they would ever have widespread appeal, unless, as Reuters writes, all other forms of currency suddenly lost their appeal due to some freak dip.

The analysts’ report said:

“Even in extreme scenarios such as a recession or financial crises, there are more liquid and less-complicated instruments for transacting, investing and hedging.”

In the context of these comments, it may be worthwhile to remember that the giant itself had signed up for some collaborations with cryptocurrencies ZCash and Ripple, with its commercial banking arm JP Morgan Chase at the forefront.