Morgan Chase’s JPM Coin: A Banker’s Intranet, or the First Major Attack on Bitcoin?

JP Morgan Chase unveiled plans for its JPM Coin on Thursday, sending the cryptocurrency universe into equal fits of both rancour and rapture.

While some see institutional adoption of cryptocurrency as the most bullish news of 2019, many are not quite sold on the concept; and some are already fearing the emergence of a ‘Ripple Killer’ or even a ‘Bitcoin Killer’.

As ever, the truth is probably more subtle, and more interesting than the sensational headlines suggest.

JPM Coin ‘Would Have Pumped BTC’ In Bull Market

At the most extreme end of the enthusiasm spectrum we have the assertion by one ‘crypto influencer’ on crypto-twitter that JPM Coin would have have positive effects on Bitcoin in a bull market scenario.

“This JP Morgan news would have pumped $BTC $1000+ in a bull market…”

Of course, a $1,000 increase when BTC’s priced at $20,000 is very different from when BTC’s priced at $3,000. One would equal a 5% increase, and the other a 33.3% increase – but let’s not deprive influencers of their fun and games.

One thing that influencers are good for is that the following they attract (43k in this case) can be put to good use. The poll below, taken from a relatively large sample size, shows that opinion is split on what JPM means for the broader crypto market.

Poll results showing response to JPM Coin.

But let’s bear in mind that all that really happened was a new stablecoin was announced. The concept of it having a bullish or bearish effect on the cryptocurrency sphere is a loose one.

Bitcoin and Ripple Killer?

Any notion of JPM Coin being a Bitcoin killer was put to bed pretty quickly in this takedown by CCN’s P.H. Madore: Why JP Morgan’s ‘Bitcoin Killer’ Isn’t Even a Real Cryptocurrency – but that didn’t stop panic from spreading initially.

Where panic might be more readily directed however is in the vicinity of Ripple and XRP. Not to underplay some of Ripple’s payment solutions – which have already been massively adopted – but if major institutions now have the choice of doing business with JP Morgan Chase, or the often controversial, and relatively unknown Ripple Labs, which one are they more likely to choose?

A Banker’s Intranet?

Cypherpunk and maintenance man for one of the internet’s prime hubs of blockchain info, Jameson Lopp compared JP Morgan Chase’s stablecoin to private bankers intranets of the early 90s. He said:

“Banker stablecoins are a step forward, just as banker intranets were in the 1990s. Adoption of this technology will make the transition smoother when they are forced to capitulate and adopt the Internet of Money.”

This is probably a fairer assessment of the situation, and one that gives room for nuance – although the nuance is shattered by the cock-sure assertion that Bitcoin will become the internet of money.

Speaking of bankers intranets – one can imagine internet diehards complaining in the early 90s that the bankers were taking over their thing – their apparatus for freedom, from censorship and surveillance by corporations and the state – and that soon the internet would be taken over by the very people they had hoped to escape.

But that didn’t happen… did it?

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Author:
Greg Thomson is a freelance writer who contributes to leading cryptocurrency and blockchain publications like CCN, Hacked, and others.