JP Morgan’s Journey From A Bitcoin Naysayer To Jumping On The Crypto Bandwagon

JP Morgan is one of the most valued names in the financial world has recently launched its own digital coin known as JPM coin, which has brought it a ton of flak and made it the butt of most of the crypto memes.

The reason for the backlash can be attributed to the stand of the institution against cryptocurrency and Bitcoin in particular. The CEO of the firm has been quoted several times claiming that the cryptocurrency is just another bubble and it would have no major impact on the financial world.

However, that stance came crashing down when JP Morgan decided to launch their own digital entity in the form of JPM coin. The digital entity formed by Jp Morgan is pegged against the US dollar, which means at any given time, JPM coin’s value will be equivalent to that of one US dollar.

The same principle in the crypto world is called Stable coin, where a digital entity is pegged against a real-world entity to keep its price stable.

So, what changed over the years that made JP Morgan go from a crypto naysayer to launch its own digital coin. We will analyze various factors involved with the JPM coin and try to answer what made JP Morgan change its stance.

JPM Coin is Not Exactly a Cryptocurrency

It might be hard to gulp down, but the reality is everything digital is not cryptocurrency and the same holds true in case of JPM coin as well. Although the concept of the JPM coin is quite similar to that of stable coin cryptocurrency, the similarity ends right there.

JPM coin is going to be used to provide liquidity to the institutions’ cross border transaction system. It would not be listed on the crypto exchange market and cannot be used to sell, buy or trade anything. The coin cannot be used either as a form of exchange or store of value. The only way to own a JPM coin is if you are a JP Morgan customer using its banking services to make cross-border payments.

The company says that the newly formed coin would help it scale its banking system and also provide liquidity to its customers to bank upon. Thus, calling it a cryptocurrency would be unfair to both, the JP Morgan and the crypto community.

However, having cleared the major differences between the two digital entities, one should not be surprised if the institution decides to list the JPM coin on the market in the future. The reason being, at the end of the day it does not matter what you said about something, but how much profit you can make of the technology which you so dearly bashed for long.

The major point of argument by JP Morgan against the cryptocurrencies was its extremely volatile nature due to no real-world entity backing it. However, during the recent bearish trend, the volatility factor has been cut down to quite an extent, thus drawing the interest of some of the more traditional Wall Street investors towards the crypto space.

What Could Be The Reason Behind JP Morgan’s Change Of Heart

I would like to draw your attention towards the dotcom boom of the late ’90s where it faced the similar problems that the crypto space is facing today. Even back then people were critical, and cautious over making any investment into it, but as the internet became more common and people saw the advantage over traditional methods they jumped on it without bothering about their earlier stance.

JP Morgan’s criticism was not taken in good stride by the crypto community and in this age of internet social media, the backlash was exponentially higher. But as the 2018 bearish trends stabilized the market, even the biggest critiques are jumping to bank on the trend.

The other major factor that might have contributed towards forming the JPM coin is that the crypto world is not as decentralized as it tries to project. Take Ripple for example, whose xRapid banking solutions are being adopted by major banks around the world, but its local coin XRP is one of the most centralized entities in the crypto space. The developers or creators have control over billions of XRP tokens. Similarly, most of the other altcoins are centralized in one way or the other.

Thus, criticizing JPM coin for banking on the crypto trend is not just flawed but not worth the time. Before you want to point fingers at others, you need to make sure that you don’t have the same flaws.

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