Jamie Dimon Slams Bitcoin as a Fraud

JPMorgan Chase & Co. Ceo Jamie Dimon said he would open fire any employee trading bitcoin to be “ stupid. ”

The particular cryptocurrency “ won’ t finish well, ” he told a good investor conference in New York upon Tuesday, predicting it will eventually blow up. “ It’ s a fraud” plus “ worse than tulip lights. ”

Bitcoin initially slipped after Dimon’ ersus remarks. It was down as much as second . 7 percent before recovering. A week ago, it slumped after reports that will China plans to ban investing of virtual currencies on household exchanges, dealing another blow towards the $150 billion cryptocurrency market.

Tulip glasses are a reference to the mania that will swept Holland in the 17th hundred years, with speculators driving up costs of virtually worthless tulip lights to exorbitant levels. That didn’ t end well.

In bitcoin’ s case, Dimon said he’ s skeptical government bodies will allow a currency to can be found without state oversight, especially if some thing goes wrong. “ Someone’ ersus going to get killed and then the particular government’ s going to come down, ” he said. “ You just noticed in China, governments like to manage their money supply. ”

Dimon differentiated between the bitcoin currency and the underlying blockchain technologies, which he said can be useful. Nevertheless, he said banks’ application of blockchain “ won’ t be over night. ”

Read a QuickTake: The enthusiasm over bitcoin and blockchain

The bank chief stated he wouldn’ t short bitcoin because there’ s no informing how high it will go just before it collapses. The best argument he’ s heard, he said, is it can be useful to people in places without other options — so long as the availability of coins doesn’ t surge.

“ If you were within Venezuela or Ecuador or Northern Korea or a couple of parts like that, or if you had been a drug dealer, a killer, stuff like that, you are better off performing it in bitcoin than U. Ersus. dollars, ” he said. “ So there may be a market for that, yet it’ d be a limited marketplace. ”

To be sure, Dimon later noted that his child purchased some bitcoin.

Gundlach’ s Concerns

“ It’ s interesting that will somebody with that high profile of the organization is out there with that bold statement, ” Jeffrey Gundlach, chief investment official of DoubleLine Capital, said on the webcast Tuesday after Dimon’ h remarks.  

Gundlach said he doesn’ t possess a view on bitcoin but that he’ s concerned it may be more susceptible to manipulation than enthusiasts admit. “ Maybe I’ m just as well old, but I’ m likely to let this mania go on with no me. ”

1 place where cryptocurrencies and conventional finance are coming together are at CBOE Holdings Incorporation. , the owner of the Chicago Panel Options Exchange. Last month, the particular firm teamed up with Gemini Rely on Co. — the startup developed by the Winklevoss twins made popular by the 2010 Facebook film “ The Social Network” — using a plan to offer bitcoin futures.

CBOE’ s chairman plus CEO, Ed Tilly, defended this kind of efforts after Dimon’ s  comments.

“ Like it delete word, people want exposure to bitcoin, ” Tilly said. Believers can wager on its rise, and Dimon is welcome to take the other aspect, he said. “ We’ lso are happy to be the ones in the middle. ”