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JPMorgan's Jamie Dimon Says Cryptocurrency a Fraud, Bound to Fail

posted by martyb on Friday September 15 2017, @04:27AM   Printer-friendly
from the check-back-in-ten-years dept.

Geezer writes:

In a recent Reuters story http://www.reuters.com/article/us-usa-banks-conference-jpmorgan/jpmorgans-dimon-says-bitcoin-is-a-fraud-idUSKCN1BN2KP, JPMorgan's Jamie Dimon threw a bomb at the emerging cryptocurrency.

In the story he states, "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."

He goes on to compare Bitcoin to the 17th-century Dutch tulip bulb situation.

Is he right, or is he just shilling for the present system of imaginary-value fiat currencies?

[Separately, according to Bloomberg, Bitcoin has been on a five-day decline: Bitcoin Crashes After Chinese Exchange Says It Will Halt Trading. --Ed.].

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  • (Score: 2) by Grishnakh on Friday September 15 2017, @02:06PM (1 child)

    by Grishnakh (2831) on Friday September 15 2017, @02:06PM (#568441)

    By that measure banknotes in transactional terms are worth much more than their face value, since there is far less physical currency in circulation than there is M1 money supply.

    Physical currency doesn't need to match the M1 money supply; most financial transactions are done electronically now. Physical currency ("cash") is just used for transactions which aren't done electronically. The difference between fiat currencies and cryptocurrencies is that the electronic fiat currency transactions go through central banks.

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  • (Score: 2) by n1 on Friday September 15 2017, @07:29PM

    by n1 (993) on Friday September 15 2017, @07:29PM (#568646) Journal

    The comment i replied to was directly comparing fiat banknotes with bitcoin as if banknotes are the only form of fiat, and the physical manifestation is what gives it value.

    The central bank part is right, but bitcoin has the ledger/blockchain. Right now central banks (BoJ, ECB, SNB) are 'printing' M1 money that are not bank notes and directly buying privately issued bonds and stocks, on top of how money is 'created' in fractional reserve banking by private banks and not the central banks.

    Also worth remembering the majority of central banks in the world are hybrid public-private institutions held accountable to absolutely no one for any of their policy decisions, including how much money they print and where they allocate/spend/distribute it.