Out of all of the major financial giants, J.P. Morgan has arguably been the most vocal opponent of Bitcoin over the recent years. The latest statements from the bank’s senior hierarchy show nothing has really changed.
Jamie Dimon, the CEO of J.P. Morgan, labelled Bitcoin a “fraud” in 2017. He went even further by adding that “someone is going to get killed”. Later on, he doubled down by adding that trading bitcoin is “stupid” and that cryptocurrency will ultimately “blow up”.
CNBC now reports that Jan Loeys, managing director of the New York-based bank, wrote in a weekly note to clients about his scepticism over the value of digital currencies.
“We have long been skeptical of cryptocurrencies’ value in most environments other than a dystopian one characterized by a loss of faith in all major reserve assets”.
Although more diplomatic language has been used by Loeys, by reading between the lines one can conclude that the latest note is as harsh as Dimon’s previous statement.
One may still ask why such comments. Loeys continues to say that
“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 part due to the scale afforded by fiat currencies’ legal tender status”.
During the recent crash in the value of the entire cryptocurrency market, Newconomy wrote multiple analyses on the price analysis of Bitcoin and other digital assets. We have reiterated multiple times that Bitcoin looks like it is heading towards big support located around $3,000, or just below.
J.P. Morgan, in its own pessimistic style, mentions $2,400 as the next support, while also mentioning levels as low as $1,260, if the “bear market persists”. In case this scenario plays out, Bitcoin would lose almost 95% of its value compared to the all-time high of $19,870.
During the recent World Economic Forum in Davos, Dimon was asked to comment on the recent developments in the cryptocurrency market. Although he could have, he refused to take a victory lap while adding that he didn’t take any satisfaction watching Bitcoin’s crash at the end of 2018.
In the end, Dimon offered some optimistic predictions for the blockchain industry.
“Blockchain is a real technology — it’s just a database we can all access that’s kept up-to-date.”
It remains to be seen whether Dimon will be right again, but in case the price analysis provided in the recent bank’s note becomes a reality, we definitely won’t be talking about “price correction” anymore.
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