Earlier this week, JPMorgan CEO Jamie Dimon released a controversial statement at a banking industry conference organized by Barclays, condemning bitcoin and threatening to fire portfolio managers within JPMorgan who have been trading bitcoin. Despite the warning, according to sources JPMorgan Securities Ltd. purchased massive amounts of bitcoin through Swedish Bitcoin exchanges when the price dipped to the $3,000 level.
Dimon’s baseless comments toward bitcoin and his threats to traders led to criticism from bitcoin experts, bankers and former JPMorgan executives including former JPMorgan head of global macro Alex Gurevich.
Jamie, you’re a great boss and the GOAT bank CEO. You’re not a trader or tech entrepreneur. Please, STFU about trading $BTC.
— Alex Gurevich (@agurevich23) September 12, 2017
More to that, Dimon demonstrated a complete lack of knowledge in the structure of bitcoin and blockchain technology in general, when he stated that bitcoin should be closed down by the government in the near future. CNBC analyst Brian Kelly criticized Dimon’s statement, explaining that bitcoin was specifically designed to circumvent governments and authorities by creating a decentralized financial system.
Despite Dimon’s strong condemnations on bitcoin and the threats toward JPMorgan traders, many trusted sources including bitcoin developer Andrew DeSantis and bitcoin trader IamNomad revealed that JPMorgan Securities Ltd. purchased massive amounts of bitcoin through Swedish bitcoin exchange traded note Bitcoin XBT.
Similar to Digital Currency Group’s Bitcoin Investment Trust (GBTC), Bitcoin XBT is an investment vehicle designed for institutional and retail traders to invest in bitcoin through strictly regulated channels in the public stock market. Both DeSantis and IamNomad revealed that many accounts under JPMorgan Securities Ltd. purchased bitcoin as the price of bitcoin dipped below $3,000.
On the World Crypto Network, a YouTube news channel and podcast hosted by Vortex focusing on cryptocurrencies, bitcoin consultant and derivatives trader Tone Vays noted that it is not possible any trader at JPMorgan directly invested in a bitcoin investment vehicle. He suggested that a more likely situation would be JPMorgan processing bank transfers to Nordic Nasdaq stock exchange in which Bitcoin XBT is supported, on behalf of their customers.
Although IamNomad emphasized that a department at JPMorgan could have invested in Bitcoin XBT since traders are not allowed to invest in bitcoin directly at JPMorgan, a more reasonable explanation of JPMorgan’s bank transfers to Bitcoin XBT would be that JPMorgan clients purchased bitcoin exchange traded notes through Bitcoin XBT on Nordic Nasdaq.
Whether JPMorgan purchased shares of Bitcoin XBT or not is of less importance. It is crucial for investors and traders to takeaway the fact that an increasing number of JPMorgan traders are willing to purchase bitcoin and demonstrating enthusiasm even after the harsh criticism toward bitcoin by the company’s CEO.
As mainstream adoption of bitcoin as a digital currency, long-term investment and safe haven asset continues to increase at an exponential rate, demand towards the crypto from public markets, professional and institutional traders will increase rapidly. Regardless of the recent closure of Chinese bitcoin exchanges, international markets and leading regional bitcoin exchange markets are strengthening with efficient regulations and the emergence of major conglomerates within the global bitcoin industry.
Image by Håkan Dahlström, License for Commercial Use