J.P. Morgan, the largest U.S. bank by assets, has been waging a war of words with bitcoin and cryptocurrency for years.
The bitcoin price has swung wildly since J.P. Morgan chief executive Jamie Dimon called bitcoin a “fraud” in September 2017—rising to around $20,000 per bitcoin before crashing to under $4,000 (twice).
Now, J.P. Morgan’s turbulent relationship with bitcoin appears to be rapidly softening, after the bank added its first crypto exchange customers and Dimon reportedly hosted secret meetings with the boss of major bitcoin and crypto exchange, Coinbase.
Earlier this month, J.P. Morgan signed Coinbase and rival bitcoin and crypto exchange Gemini after a lengthy vetting period, it was first reported by the Wall Street Journal.
J.P. Morgan approved the two bitcoin exchanges’ accounts last month and is already processing transactions—potentially signalling the end of the crypto industry’s banking woes.
The bitcoin and cryptocurrency community has complained for years that banks including J.P. Morgan have denied them services and blocked accounts that dealt with crypto businesses.
Meanwhile, it has emerged Jamie Dimon has been hosting secret meetings with Coinbase chief executive Brian Armstrong since 2018, author Jeff Roberts revealed in his book, Kings of Crypto.
“Ironically, Brian Armstrong and Jamie Dimon of J.P. Morgan—who was the biggest enemy of bitcoin and has pissed on it for years—it turns out they were having secret meetings in 2018 at J.P. Morgan’s headquarters,” Roberts told Laura Shin’s Unchained podcast while promoting the book, which charts Coinbase’s rise to the top of the crypto industry.
However, J.P. Morgan’s interest in cryptocurrencies might not extend all the way to bitcoin quite yet.
“We are supportive of cryptocurrencies as long as they are properly controlled and regulated,” Umar Farooq, JP Morgan’s head of digital treasury services and blockchain, said back in 2017.
J.P. Morgan launched its own answer to bitcoin last year, JPM Coin. Unlike bitcoin, JPM Coin is pegged to the dollar and aimed at speeding up and reducing the costs of global payments.
Meanwhile, some have accused Coinbase’s Armstrong as being “skeptical” of bitcoin while working to promote other blockchain networks and cryptocurrencies such as ethereum.
“I’m sure he would deny it, but it’s interesting to me that the CEO of the world’s most prominent bitcoin-related company seems so skeptical of bitcoin,” said Bloomberg editor and analyst Joe Weisenthal, commenting on a Twitter thread by Armstrong suggesting it might not be bitcoin that pushes the cryptocurrency ecosystem into the mainstream.
Despite J.P. Morgan’s softening attitude toward bitcoin and crypto, the nascent technology is still fighting an uphill battle.
Earlier this year, Treasury secretary Steven Mnuchin warned “significant” new bitcoin and cryptocurrency regulations are on their way, Minneapolis Federal Reserve president Neel Kashkari branded cryptocurrencies “a giant garbage dumpster,” and the Department of Justice called bitcoin mixing “a crime.”
Just this week, Goldman Sachs listed five reasons that “cryptocurrencies including bitcoin are not an asset class” in a much-hyped but ultimately disappointing presentation titled “U.S. Economic Outlook and Implications of Current Policies for Inflation, Gold and Bitcoin.”
Ernest Hemingway described going bankrupt as “gradually and then suddenly”—Wall Street’s adoption of bitcoin and cryptocurrency could be happening the same way.