This American bank could lead the world of digital money
Banks began to show attention to cryptocurrencies from the very moment when they were born. Somewhere from the end of the last decade. Especially after the birth of the most famous private digital currency in January 2009 bitcoin... Some banks have established divisions that have begun to study the prospects for the development of digital currencies and their impact on banking. The most daring banks are already engaged in quite practical matters, especially the development and implementation of technologies blockchain... And the most advanced banks began to prepare projects for creating their own digital currencies. The desire to be the first in the case of the "green light" for digital currencies was great.
And it seems that the bank had the greatest desire to be the first JPMorgan Chase - a giant American bank from Wall Street, one of the "big four" US banks along with Bank of America, Citigroup and Wells Fargo... At the end of last year, assets JPMorgan Chase amounted to 2.687 billion dollars, and this is not counting assets worth several trillion dollars, which the bank manages on the basis of special trust agreements. At the end of 2019, the bank's net profit was $ 36.4 billion, and the number of employees in all divisions at the end of the year was 257 thousand people. For most indicators in the "big four" JPMorgan Chase It ranked first. JPMorgan Chase - the most expensive bank in the US stock market and, perhaps, in the entire Western world. It is believed to be larger JPMorgan Chase three banking giants of China, but they surpass this American bank in terms of assets, and in terms of market capitalization they are noticeably inferior to it.
Many experts successes JPMorgan Chase attributed to its CEO, president and chairman of the board James Dimon (James L. Dimon), who has been at the head of the bank for fifteen years. Daimon is called "financial genius", "god of money", "most creative banker", etc.
An amazing feature of this banker should be noted: he was a very energetic opponent of any digital money. He did not hesitate to call bitcoin and other private cryptocurrencies are "scams" that have nothing to do with money. And he fully aligned himself with the heads of the US Federal Reserve and the US Treasury, who stated that cryptocurrencies threaten the entire monetary system and the country's economy. He agreed with the heads of law enforcement organizations and departments, who believed that cryptocurrencies would only contribute to the spread of drugs, shadow business, and crime.
To this day, journalists recall Daimon's vivid speech at a banking conference in September 2017, when he threatened to fire any trader. JPMorgannoticed in carrying out transactions with cryptocurrencies. The then speech of the head of the bank JPMorgan very excited the camp of supporters of cryptocurrencies. They did not hesitate to tell James Dimon and other Wall Street bankers that they are the real scammers, and that cryptocurrencies should put an end to banking fraud, which has been flourishing for at least three centuries. One of the brightest representatives of the cryptocurrency community, TV presenter Max Kaiser During his emotional speech at Erasmus University in Rotterdam, he stated: “Wall Street is a scam. America is a scam. Banks are a scam. Central banks are a scam. We live in an era of fraud ... Everything here is based on fraud, and they get their percentage from this fraud. This is such a business model ... We live in an era dominated by financial terrorists ... The banking jihad is already here to destroy itself with us! "
And suddenly, in the position of the head of the bank JPMorgan there was a fracture. For many, Daimon's statement on January 9, 2018, when he expressed regret over his previous tough speeches against cryptocurrencies, became a sensation. He acknowledged that the blockchain technologies accompanying these cryptocurrencies deserve attention, that they can be used in banking and other activities, accelerating the speed of operations, increasing their reliability and reducing costs.
And then it turned out that at the time when James Dimon was attacking cryptocurrencies, the London branch of his bank had already started developing a blockchain strategy. This direction was led by a young employee Oliver Harris... In April 2018 JPMorgan jointly with banks ANZ and Royal Bank of Canada launched testing of its own blockchain platform blockchain... Net Quorum was developed in 2016 as part of Ethereum Enterprise Alliance (EEA), one of the founding partners of which is JPMorgan... In 2017, the bank JPMorgan launched the first scalable interbank network IIN (Interbank Information Network), created to solve long-standing problems of interbank information exchange, cross-border payments. Interbank information network uses the platform Quorum... As of December 2019, the network had more than 365 members, about 60 banks were already actively working within its framework.
It can be assumed that James Dimon was not a fanatical opponent of cryptocurrencies until 2018, and his emotional attacks on such currencies were aimed at weakening the positions of competitors in the digital money and technology market. In 2018 JPMorgan began work on transforming Quorum into an independent unit, which will be under the full control of this bank. Today Quorum became the main blockchain division of the bank. In February 2020, it became known that it was planned to expand the bank's blockchain division by including the team ConsenSys - a well-known startup in the field of blockchain technologies. The startup was launched in 2017 by a well-known person in the world of cryptocurrencies Joe Labin, one of the co-founders ethereum (Ethereum), the second most popular cryptocurrency after Bitcoin. By the way, representatives of the Fintech community of companies reacted very emotionally to the news that Joe Lubin will now work in a division of the largest Wall Street bank. They regard this as a betrayal, because Fintech positions itself as almost an ideological enemy of banks and their business rival.
The announcement by a financial holding became even more sensational JPMorgan Chase in February 2019 of plans to release own cryptocurrency - JPM Coin... This cryptocurrency is based on a modified Ethereum blockchain platform called the network. Quorum... If the Ethereum network is considered public, then the network Quorumwhere cryptocurrency circulates JPM Coin, the data for each transaction is encrypted in such a way that only participants in the transaction can access it.
cryptocurrency JPM Coin belongs to the category of a new generation of digital money called stablecoins. It is a stablecoin and will always be at $ 1. Bank representatives JPMorgan Chase prefer not to name JPM Coin money, but believe that this is only a "tool" that allows you to improve payment and settlement transactions between banks. Unlike bitcoin and other cryptocurrencies JPM Coin will not be sold on the open market. The required amount of bank cryptocurrency will be issued every time a money transfer is made, immediately redeemed using ordinary currency for an equivalent amount and destroyed. In other words, JMP Coin will not go beyond interbank payment and settlement transactions.
Now JPM Coin undergoes a test run, the system JPM may start working before the end of 2020. The media flashes different figures for the number of banks that will participate in operations with the new digital unit - from 250 to 400. Most likely, these are the banks that are members of the already operating network IIN (Interbank Information Network)...
Bank JPMorgan Chase names the following advantages that the use of JPM Coin: speeding up money transfers, especially when it comes to international transactions; the coin will be under the control of regulators and strict internal regulations of the bank JPMorganwhich will provide JPM Coin very high reliability; excluding the possibility of using transactions using JPM Coin for criminal purposes (clients of banks included in the network of the new digital unit will undergo a thorough check), etc.
James Dimon is praising his digital creation in every possible way. His Napoleonic plans are evidenced by his statements: JPM Coin only at first it will be used for interbank transactions, and eventually it will become available to the general consumer.
Apparently, Daimon is really counting on JMP coin will help the formation in the United States of the official digital currency - the one that is commonly called today DCCB (Digital Central Bank Currency) - digital currency of the central bank). At least a bank JPMorgan Chase will become the main participant in the digital dollar project, which began to be actively promoted in 2020. And as a maximum, the bank can become the leader of the whole world of digital money. Surely James Dimon dreams of when the bank's monetary unit JPMorgan Chase will replace the US Federal Reserve System (even those who are far from understanding the intricacies of monetary wisdom say that it can collapse overnight).
It must be admitted that after the launch by the bank JPM Coin All banks will have to deal with the problems of digital money, even those who until recently were skeptical about this issue. Noteworthy comment Eda Yardeni (Ed Yardeni), former chief economist German bank about JPM Coin: "If JPMorgan hadn't done this, someone else would have done it."... Now, according to Yardeni, the big banks have no choice. They will either have to join the JPM Coin network or urgently start developing their own digital currencies.
Cover photo: REUTERS / Make Segar
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