JPMorgan’s Jamie Dimon Still Has ‘No Interest’ in Bitcoin Despite Growing Adoption

JPMorgan’s Jamie Dimon Still Has ‘No Interest’ in Bitcoin Despite Growing Adoption

Institutional demand has played a critical role in the surge of cryptocurrencies in the past year, with many tech companies and large banks planning to custody virtual currencies.

But despite what many may call a significant victory for the nascent technology, critics still abound, with some openly declaring they cannot support the idea of digital currencies replacing fiat as a medium of exchange.

Jamie Dimon Still Not Intrigued by Bitcoin

One such detractor is JPMorgan Chase’s boss Jamie Dimon who has remained resolute in his criticism of the burgeoning industry.

JP Morgan Chase was once a critic turned supporter as the investment bank prepares to launch a Bitcoin fund in the coming months. But despite what has been a radical shift in mindset, JP Morgan’s CEO Jamie Dimon is still a skeptic of the volatile asset class.

While speaking at The Wall Street Journal CEO Council Summit, the billionaire investor said he isn’t interested in Bitcoin, despite the growing interest from institutions.

Dimon’s firm JPMorgan is working on a Bitcoin custody service due to ongoing client demands, Dimon noted. Beyond this, JPMorgan’s CEO won’t touch the asset class. Despite his skepticism of the influence of crypto, he remains a believer in the power of the blockchain.

Dimon explained that he believes in the real-life use cases for blockchain technology, especially for the financial sector. He revealed that his firm is also leveraging the technology to serve customers.

“But people have to remember that a currency is supported by the taxing authority of a country, the rule of law, a central bank.”

The former board member of the Federal Reserve has repeatedly kicked against the world’s first-ever virtual currency, calling Bitcoin once a “fraud” at a conference organized by news outlet CNBC.

However, Dimon has since said that he regretted his outburst while noting his indifference to the Bitcoin narrative. But he has retained a lukewarm attitude towards the emerging asset class, constantly claiming disinterest and citing volatility as a reason for it not going mainstream.

Nevertheless, JP Morgan has been quite active in the crypto space rolling out its in-house built digital token-styled JPM Coin in 2019. It has since gone on to create a blockchain unit to stay innovative in a fast-changing world.

Wall Street Piling On Crypto

Despite what might seem a bad take on crypto by Dimon, other investment firms have not remained hostile to crypto.

In the last year following Bitcoin’s unprecedented surge, institutional demand has grown following major investment in BTC and the proliferation of other crypto projects.

With decentralized finance (DeFi) radically changing the narrative on legacy-backed services like savings, deposits, borrowing, and lending, more and more banks have started joining the crypto wagon.

One such is investment bank Goldman Sachs reportedly planning to issue a Bitcoin exchange-traded fund (ETF) in the coming months. The proposal, which is still under review with the US Securities and Exchange Commission (SEC), joins a long list of Bitcoin ETF proposals brought forward to the agency.

Banks like US Bank and Bank of New York (BNY) Mellon have shown interest in cryptocurrencies in the past few weeks.

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Author: Jimmy Aki

Stablecoins Facilitated $1 Trillion in Transaction Volume in Q1 2021

Stablecoins Facilitated $1 Trillion in Transaction Volume in Q1 2021

Stablecoin monetary base is also growing, on track to hit $100 billion after more than doubling so far this year.

Total stablecoin supply has nearly hit $80 billion. Starting the year just under $29 billion, these cryptos or fiat pegged stablecoins added about 33.33 billion to its supply in Q1 of 2021.

USDT remains the dominant stablecoin with a $51.86 billion market cap while doing 3.4x of bitcoin volume at over $68 billion, as per Messari. This week, the largest US exchange Coinbase announced support for Ethereum-based USDT.

Although USDT is still the king, its dominance is gradually decreasing over time.

USDC, BUSD, and DAI were the quarter’s biggest winners, growing their share to 17%, 6%, and 5%, respectively.

With a market cap of $10.85, USDC comes in second place, doing only a fraction of USDT’s volume at $2.3 billion.

Binance’s BUSD is also gaining momentum, as it records almost $10 billion in volume while having a market cap of $5.25 billion. DAI is a $3.58 billion market cap stablecoin handling $560 million in volume.

Overall, stablecoins facilitated $1 trillion in transaction volume in Q1 2021, which is more than the previous four quarters combined, noted Ryan Watkins, a researcher at Messari.

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Stablecoins had an incredible quarter, with their monetary base continuing to rise at an accelerating pace in line with the growing adoption.

This adoption is for a number of reasons including stablecoins being easy to accept as payments. These programmable digital currencies “allows developers to trivially build with them and deploy applications with global distribution.”

Moreover, they run on global public infrastructure that operates 24/7/365 while offering users stronger autonomy, privacy, and interoperability qualities than existing payments solutions which require KYC and often restrict access, said Watkins.

In the stablecoin realm, Facebook’s fiat-backed project, Diem Association is aiming to launch a pilot with a single stablecoin pegged with USD later this year. First proposed in June 2019 with the name libra, the project has received opposition from regulators around the world.

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Author: AnTy

Wealth Managers Are Growing ‘Comfortable’ with Crypto But Still in ‘Education Mode’ says Fidelity

Wealth Managers Are Growing ‘Comfortable’ with Crypto But Still in ‘Education Mode’ says Fidelity

Most financial advisors and wealth managers are still in “education mode” on cryptocurrencies, said Mike Durbin, Head of Fidelity Institutional, Fidelity Investments. However, demand for crypto assets is growing among larger investors, he added.

In an interview at Reuters Digital Assets Week, Durbin shared that while some investment firms and advisors managing the fortunes of wealthy people have grown “comfortable” and “sophisticated” with crypto, most of them are still getting a grip of the technology.

“They know what they are doing, and more importantly their end investor base also knows what they are doing – but the vast majority are still in the education mode.”

Back in 2018, during the bear market, Fidelity which has $9.8 trillion in customer assets as of Dec. 31, became one of the first mainstream investment companies to embrace cryptos and set up a unit to offer crypto custody.

Interest in Bitcoin and other crypto-assets is likely to grow as “alternative investments” increase in popularity, said Durbin.

“I think that the growth rate of bitcoin or digital assets will follow in that wake of broader alternative investments.”

“There’s still work to be done there to help advisors understand portfolio construction with these kinds of expressions.”

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Author: AnTy

Bitcoin Lending Grew Nearly 12x; Only Accounts for 0.15% of the $20T Total Collateral Market

There is also growing demand for Ether among traditional actors entering crypto lending with ultra-high-net-worth individuals, corporations, traditional hedge funds, and family offices wanting to enter the market looking to generate excess yield on idle cash.

Total active collateral in the Bitcoin lending markets has grown from $1.9 billion in Q3 2019 to a whopping $24.3 billion in Q4 2020, reveals the latest joint report by Arcane Research and crypto exchange Bitstamp.

The crypto lending market is simply flourishing, but it has a long way to go with the collateral markets’ current size estimated to be $20 trillion, providing a huge potential for bitcoin as collateral.

Over 400,000 BTC are estimated to be used as collateral for Bitcoin-backed loans today, doubling over the last year, reads the report. It is particularly used to leverage up and buy more crypto for arbitrage, market-making, tax deferment, and the need for fiat and miners covering costs.

The interest rate on Bitcoin deposits is currently high at 6-10%, which is expected to decline as more BTC are collateralized, and the crypto sector grows.

In total, 625,000 BTC, approximately $30 billion, are used as collateral in the crypto market today, based on estimations of collateral held in the derivatives market and tokenized BTC in DeFi. Still, bitcoin collateral only accounts for 0.15% of the total collateral market, which is growing rapidly, states the report.

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Arcane Research expects further growth in the BTC lending market, which could be “very bullish” for Bitcoin as it allows users to employ their cryptocurrency to serve their everyday fiat-needs, without requiring the hodlers to sell and realize profits.

Bitcoin, which can be transferred around the world instantly, at almost no cost, is a superb collateral asset because it is without both counterparty risk and credit risk, reads the report.

Institutions are just as interested in the crypto lending market, with institution-focused Genesis seeing a YoY growth of 245% in their outstanding loans.

One of the market-leading companies in the lending market, Genesis has seen incredible growth over the past year. Their outstanding loans surged to $3.8 billion in Q4 of 2020, a roughly 80% growth from Q3.

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The company further processed nearly $20 billion on loans last year to institutions only, “showing tremendous demand for traditional actors entering crypto lending.” In Q4, the company also pointed to the inflow of institutional lenders as well with ultra-high-net-worth individuals, corporations, traditional hedge funds, and family offices wanting to enter the market for the first time looking to generate excess yield on idle cash.

But it isn’t only about Bitcoin; there is also growing demand for Ether among institutions. There has been a steady increase in ETH loans outstanding, which grew 177% during the last three quarters of 2020.

Like BTC, this growth was attributable to ETH’s price inflation, the biggest reason was tied to in-kind placements in Grayscale’s Ethereum Trust, according to Genesis.

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BlockFi is another company leading in crypto lending with over $4 billion in outstanding institutional loans. According to the report, BlockFi’s internal numbers show that the company is a clear competitor to Genesis on the institutional side.

In 2020, BlockFi processed $18.6 billion in loans to its institutions and private clients, and by the end of the year, it had $4.4 billion in outstanding institutional loans. These clients aren’t just based in the U.S. either, just 60%, but spread across the world — 25% in the Asia-Pacific and the last 15% are based in Europe.

Other notable competitors in this sector are Celsius which processed over $8 billion in loans, Nexo which has over 1 million users and shares profits with its token holders, and Nebeus, which was one of the first movers in 2014.

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Author: AnTy

A Growing Number of British Investors Believe Crypto is as Safe as the Stock Market

A Growing Number of British Investors Believe Crypto is as Safe as the Stock Market

A recent poll suggests that Brits are getting more comfortable with cryptocurrencies. American investors also appear to be warming up more to crypto as their appetite for risk grows.

  • Despite their growing maturity over the past few years, cryptocurrencies have continued to face criticism over their perceived volatility and susceptibility to massive price swings.
  • However, the tide appears to be turning in Britain, as investors are getting more comfortable with the fledgling asset class.

Crypto on the Same Pedestal as Stocks

This week, market research and consumer insights provider, Piplsay, shared the results of a survey conducted on British investors about cryptocurrency. The survey consisted of 6,070 British investors above the age of 18, showing that a growing number of them now view cryptocurrencies as safe investments.

As the survey showed, over 40 percent of respondents described cryptocurrencies as safe, compared to 31 percent who viewed them as dangerous. Another 27 percent responded neutrally. Comparing cryptocurrencies to stocks, 41 percent claimed that both asset classes are on equal risk footing, while 45 percent believe that stocks are still safer than cryptocurrencies.

Of those who expressed concern about cryptocurrencies, almost 30 percent cited the potential for fraud and hacks as their primary concern. 26 percent also expressed concern over regulatory uncertainty, while only 19 percent pointed to the issue of price volatility.

Despite the growing sentiment over cryptocurrencies’ safety, 57 percent of respondents claimed that they didn’t have any desire to own digital assets. Of these, 46 percent claimed that they stayed away from cryptocurrencies because they had little to no knowledge of the asset class.

At the same time, 46 percent of all respondents also opined that large brands in the country should accept crypto payments. Most of these people cited the recent increased demand for crypto as payment methods as their reason.

American Investors Beef Up Risk Appetite

Investors’ growing desire to trade in cryptocurrencies isn’t native to Britain alone. Across the pond, professional investors are also trooping into the crypto space, encouraged by the market’s growth over the past year.

Last month, a fund manager survey from Bank of America showed that Bitcoin had become the most crowded trade in the country. Per a Reuters report, 36 percent of respondents in the survey identified the “long Bitcoin” bet as the most crowded trade, beating out “long tech.”

The Bank of America report marked the first time that “long tech” will be knocked from atop its perch since October 2019. It also marks a growing positive investor sentiment for Bitcoin, which was only third on the list in December 2020.

Several fund managers have also been hyping Bitcoin as a safe asset to invest in. Last month, Anthony Scaramucci and Brett Messing of New York hedge fund SkyBridge Capital wrote in an op-ed that Bitcoin is just as safe an investment as stocks or government bonds. The hedge fund managers wrote,

“[…] increased regulations, improved infrastructure and access to financial institutions — like Fidelity — that hold investors’ money have made bitcoin investments as safe as owning bonds and commodities like gold, which are also used to balance portfolios.”

With the cryptocurrency market delivering steady returns over other investment classes, investor sentiment remains strong.

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Author: Jimmy Aki

Canadian Firm, Accelerate, Files for a Bitcoin ETF (ABTC) on Toronto Stock Exchange

Companies have a growing demand to launch Bitcoin exchange-traded funds (ETFs) as the cryptocurrency market settles above the 41 trillion market cap. Accelerate Financial Technologies, a Canadian fintech firm, is the latest to file and obtain a receipt for a preliminary prospectus with the Canadian financial regulators to launch its Accelerate Bitcoin ETF under the ticker “ABTC.”

In a statement released on Wednesday, Accelerate confirmed a share of ABTC units have filed for listing on the Toronto Stock Exchange but are yet to receive conditional approval on the listing. ABTC will offer U.S. dollar-denominated units and Canadian dollar-denominated units, with a management fee of 0.70%.

Accelerate launched its first Bitcoin fund in 2017, providing its clients with one of Canada’s most innovative and fastest-growing alternative investment solutions. Julian Klymochko, CEO and founder of Accelerate, said, “he has always been an advocate of the asset class” given the coins’ past performance. Klymochko added,

“Bitcoin has been one of the best-performing asset classes on a 1-year, 3-year, 5-year, and 10-year basis, both absolute and risk-adjusted. Given bitcoin’s historical track record and future potential, along with its portfolio diversification properties, we are looking forward to offering investors exposure to the asset class in an easy-to-use, low-cost ETF.”

The demand for Bitcoin ETFs seems to be back after a long layoff in the market following VanEck’s rejected proposals by the U.S. Securities Exchange Commission (SEC) in 2018. The company has once again filed for a Bitcoin ETF, claiming it will hold physical BTC this time.

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Author: Lujan Odera

New Report Traces Origin of Extensive Celebrity Bitcoin Scams to Eastern Europe

Bitcoin scam ads appear to be growing as hackers are looking to capitalize on the asset’s rally.

In a recent investigation, authorities appear to have traced a Bitcoin ad-based scam operation to addresses in Russia.

Russia or Ukraine

Last weekend, The Guardian Australia reported on a significant Bitcoin ad scheme operating for about two years. The scammers use images of several famous people without their consent in articles promoting fraudulent crypto investment schemes. Many of these schemes promise vast returns on activities ranging from crypto investment to mining, hoping to catch unsuspecting victims.

The Guardian had traced five people who reportedly registered hundreds of fake websites related to the scam. All five have addresses in central Moscow, and the news source added that it had submitted the Email addresses for two of the suspects to Google.

The Guardian also reported that the scam could have also originated from Ukraine. It referenced a March 2020 report from the Organized Crime and Corruption Reporting Project (OCCRP), which discovered a call center in Kyiv that ran ads for similar Bitcoins scams.

Keeping the Lawyers Happy

The investigation into the case appears to have been self-preservatory. The company fell into troubled waters with Australian millionaire Dick Smith after his identity was used in an ad campaign to promote fraudulent crypto schemes on The Guardian.

As The Australian reported in October, Smith, who runs an electronics retail store named after himself, threatened to sue The Guardian Australia for defamation. While the ads themselves didn’t feature cryptocurrencies, they linked to fake interviews featuring successful individuals like Smith.

In these interviews, Smith reportedly boasts about making significant gains in his crypto investments. Many of the interviews also reportedly featured attractive headlines like “Get rich in a few days” and “How to make money easy.”

Smith’s lawyer, Mark O’Brien, said at the time that the business mogul was focused on ensuring that the scams come to a permanent end.

“While we acknowledge that The Guardian Australia does take the fraudulent advertisements down once notified, that does not prevent [its] Australian readers from falling victim to this prolific cryptocurrency scam.”

Hoping to avoid any legal case, the news medium appeared to have gone on an investigation spree of its own. Investigations from Google should help bring more clarity to the issue, and the news source will hope to bring the scammers to justice sooner rather than later.

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Author: Jimmy Aki

Coinbase Expands its Regulatory Compliance Team with Two New Hires

San Francisco-based cryptocurrency exchange Coinbase has made two new additions to its growing legal and compliance team. The company hired Milana McCullagh as Vice President, Deputy General Counsel for Product and Commercial, and Katherine Minarik as Vice President, Deputy General Counsel for Litigation.

Both the new hires will help drive Coinbase’s momentum to ensure its internal and external operations remain regulatory compliant.

While Milana spent over a decade at Google supporting the tech giant’s some of the most notable products, Katherine previously has been with Dyson, Cleverbridge, and over a decade at Bartlit Beck Herman Palenchar & Scott law firm. Paul Grewal, Coinbase’s Chief Legal Officer, wrote,

“One of our key priorities at Coinbase is to be trusted as we create an open financial system for the world.”

A Hiring Spree

Coinbase is currently hiring for many roles, 182 to be exact, across different departments, including security & privacy, legal & compliance, international expansion, data, and engineering. The exchange is also hiring a Director for the position of Belonging Inclusion & Diversity. The job description reads,

“This individual will be responsible for owning, executing, and advancing our newly refreshed BID Strategy, which rests on the vision that every employee feels they belong and can succeed.”

This remote job for the USA follows its CEO Brian Armstrong’s apolitical mission statement, for which, while he received support, he also got a public backlash.

This led 5%, about 60 of its employees, to accept a company’s severance package to employees that aren’t comfortable with Armstrong’s position.

The previous head of belonging, inclusion, and employee experience, Tariq Meyers, left over the summer for unclear reasons. Meyers was one of Coinbase’s senior Black employees. Before Armstrong made his political mission public, there have been reportedly a walkout of an employee because of an internal Ask-me-Anything session about Black Lives Matter.

Now, for the new head of BID, the person is required to take a data-driven approach to get “an understanding of BID’s impact on culture and the Coinbase experience” and then “leverage” all the new and existing data to attract and select talent & further grow and retain it.

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Author: AnTy

Anchorage & Tokensoft Collab to Bring Wrapped Coins to Ethereum; Zcash (ZEC) Is Up First

The growing popularity of decentralized finance (DeFi) has attracted many other digital assets to Ethereum, including Bitcoin, in a wrapped layer one solution. The latest to join the league is the privacy-centric coin Zcash (ZEC). The Wrapped Zcash is brought into the Decentralized ecosystem by Anchorage in association with Tokensoft.

Wrapped ZCash (wZEC) is the first asset launched by the “wrapped” project in association with Ethereum tokenizers Tokensoft and the qualified custodian Anchorage. The liquidity for the wrapped project would be offered by over-the-counter (OTC) liquidity provided by CMS Holdings.

However, Wrapped Zcash is not the first wrapped digital asset on Ethereum. Wrapped Bitcoin has been quite popular as the DeFi market continues to explode. A wrapped digital asset transfers the value of that particular digital asset onto the Ethereum blockchain by creating an ERC-20 token with a 1:1 value representation against the asset. Thus one Wrapped bitcoin would be equivalent in value to that of 1 bitcoin.

This allows for other digital asset holders to access the DeFi space and collateralize that asset instead of buying Ether and then collateralizing it. This also helps in increasing the liquidity of the DEX ecosystem.

Zooko Wilcox-O’Hearn, Zcash founder and Electric Coin Company CEO, commented on their recent association with Anchorage and Tokensoft and said,

“I’m thrilled that there is such interest, and that people can, and do, innovate and deploy extensions on top of Zcash without the Electric Coin Company’s knowledge or approval.”

“I also agree that it’s great for people to have more alternatives to centralized exchanges (CEXs), and the way that CEX’s have to comply with arbitrary demands from their banks.”

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Author: James W

Crypto Exchanges FOMO into DeFi, Binance Takes on Ethereum

Everyone wants a piece of decentralized finance (DeFi), which is growing like crazy. Crypto exchanges, especially, are taking a special interest in the sector.

This week, OKEx announced that with the latest upgrade of its OKxChain network, it had become the most decentralized exchange powered public chain. Huobi also jumped in and added ten more members to its DeFi team, which is “a consortium of centralized and decentralized financial services providers.”

Binance has already been going deeper in DeFi, announcing a $100 million fund and launching Binance Smart Chain (BSC).

In this growing competition of CEXs in DeFi, OKEx CEO Jay Hao recently called out Binance Smart Chain for not being decentralized.

“Built on BSC, BakerySwap caused huge losses for many retail investors <12h after mining began, which led to protests against BSC in China & elsewhere,” said Hao adding, “Those financial losses are a result of blind trust in Binance.”

“I strongly condemn Binance’s irresponsible behavior, which damaged the crypto community’s trust and caused DeFi to regress. Trust is hard to build but easy to tear down. For the sake of users’ interests & Crypto development, pls stop these tricks and BUILD the real DeFi,” said Hao.

Binance Marching Ahead

The leading spot exchange ERC20-based stablecoin has been gaining traction lately, seeing its volume surpassing Circle and Coinbase’s USDC Coin (USDC). In the past week, over $100 million worth of Binance USD (BUSD) has flowed into the exchange.

But it was actually USDC whose supply has doubled since the beginning of August. In just two months, USDC’s supply went from 1 billion to 2 billion, while it took two years for its supply to go from zero to 1 billion.

Binance has also taken the road to yield farming, the heart of DeFi mania, which helped its BNB token return to life.

“This is a good way to participate in the yield farming craze in a relatively low risk way,” said a researcher from Crypto fund The Spartan Group. For BNB, it means a constant demand for staking/holding making it an attractive asset to own, he said.

The exchange also introduced Binance Launchpool, which attracted many DeFi projects and away from Ethereum, the center of the DeFi world on which most of the projects are built on.

Binance CEO Changpeng Zhao noted that while BNB’s market cap is still 10% of ETH, the transaction volume of BSC is 40% of the Ethereum network. Recently, he also noted that while BSC is 100% EVM compatible, it also has 20x lower fees and no congestion, to attract more developers and projects.

“Did a quarter of users move already? Or is this just demand that was curbed due to high fees? Looks like the later as ETH tx count didn’t drop much. Growing, not taking, the pie,” he said.

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Author: AnTy