Categories
Crypto Videos

JPMorgan Chase Executives Talk About Stablecoins!


JPMorgan Chase Executives Talk About Stablecoins

During a JP Morgan Chase’s Q4 2020 earnings call, the firm’s CEO Jamie Dimon and CFO Jennifer Piepszak discussed the OCC’s recent approval of banks being able to use stablecoins for payments, as well as whether or not this approval will have any significant impact on the development of JPM Coin, the company’s private digital currency. 

During the Q&A portion of the call, Portales Partners analyst Charles Peabody asked the executives about the OCC approval for banks to use various public blockchain networks for payments.

“That guidance enables an offering of stablecoins going on a public blockchain. That doesn’t impact the JPM coin. You should think about JPM coin as the tokenization of our customer deposits,” stated JP Morgan CFO Jennifer Piepszak, according to the call transcript.

However, she did not completely rule out the possibility of a stablecoin backed by JPM if customers showed interest.

“It’s obviously very early. We will assess the use cases and customers’ demands. But, it is still too early to see where everything goes for us.”

JPM CEO Jamie Dimon was quick to jump in and mention that the bank is currently “using blockchain for sharing data with banks,” and adding that their bank is at the forefront of development.

Debuted in Oct 2020, JPM Coin is used on the backend of JPM’s payments systems, helping the firm settle nearly $6 trillion in payments on a daily basis. 

Ultimately, Dimon seemingly implied that crypto payments settlement wouldn’t greatly change how JP Morgan operates.

“I do expect that stuff is coming soon, and it may not change our world all that much.”

However, Dimon may be underestimating the impact that crypto will have on the payments landscape. Paypal is one of the Fintech giants that Dimon mentioned by name as a direct competitor, confirmed that crypto payments would be available in 2021. The CEO — a former skeptic of cryptocurrencies — made it very clear that payments will become an increasingly crowded field over the next decade:

“I expect it to be a very, very tough competition in the next ten years. However, I expect to win. So help me, God.”

Categories
Crypto Videos

JP Morgan – Institutions Ditching Gold ETFs For Bitcoin!

Institutions Ditching Gold ETFs For Bitcoin – JP Morgan Opens Up

The demand for Grayscale’s Bitcoin Trust has increased so much lately that it has surpassed all gold ETFs combined, according to JPMorgan Chase, the largest bank in the US.
JPMorgan noted that Bitcoin is eating away at gold ETFs demand very quickly. The news came out in a report shared by Michael Sonnenshein, who is currently the managing director of Grayscale Investments.

More and more institutional investors, such as family offices, are now viewing the world’s largest cryptocurrency as an alternative to the yellow metal used to be a hedge and the go-to safe-haven.
The Grayscale’s Bitcoin Trust flow trajectory in October became significantly steeper, while all gold ETFs remained basically flat. “The contrast between gold ETFs and Grayscale Bitcoin Trust lends support to the idea that investors that invested in gold ETFs previously, such as family offices, maybe looking into Bitcoin and seeing it as an alternative to gold.”


Bloomberg’s report dating from September showed Grayscale’s Bitcoin Trust is outperforming 97% of all US ETFs. The bullish report regarding Bitcoin’s adoption caps off an amazing week for the crypto asset management firm. Sonnenshein stated that his company had recorded the largest raise across its suite of products, totaling $237 million.
While GBTC remains the most popular investment vehicle for Grayscale, the Ethereum Trust is also gaining a lot more traction lately, with a record-shattering $58 million.

Last month, Grayscale’s Ethereum Trust became an SEC-reporting company, which means that it now has to file quarterly as well as annual disclosures with the US securities regulator. The company had over $1 billion worth of inflows in its third quarter of 2020. Its inflows in 2020 are now nearing a whopping $3 billion. Overall, Grayscale has over $9.1 billion worth of assets under management.

All in all, the trend of crypto surpassing traditional asset classes in terms of performance is becoming a trend, which is certainly bringing more and more investments to the sector. With so many institutions joining the movement lately, cryptocurrency is poised to receive the attention of the broader masses in the short future.

Categories
Crypto Videos

Bitcoin Over Gold in the Long Run – JP Morgan’s Stance!

Bitcoin Over Gold in the Long Run – JP Morgan’s Market Analysis

 

Bitcoin’s 2020 surge is poised to continue in the long run as the digital cryptocurrency is a direct competitor to gold, as it can now be classified as an “alternative” currency, JPMorgan stated in a public statement.
Bitcoin has surged more than 90% year-to-date, and the announcement that PayPal would enable its users to buy, sell, hold, and even use cryptocurrencies served as yet another high-level endorsement for the sector.

Earlier this in October, Square purchased $50 million worth of Bitcoin as proof of further commitment to viewing the cryptocurrency as a long-term investment. On top of that, Microstrategy has invested over $250 million in Bitcoin, stating that investing in the largest cryptocurrency by market cap is not a speculation or a hedge, but a deliberate corporate strategy.
However, Bitcoin is still a relatively small asset, and the crypto sector as a whole a small asset class. It has been, up to recently, mostly favored by millennial investors rather than the older generations that predominantly favor gold or other precious metals.

The physical gold market, according to JP Morgan, is currently worth around $2.6 trillion, and that number includes assets held within gold ETFs as well. If Bitcoin wants to catch up to gold in terms of market value, the cryptocurrency would have to increase its market capitalization over ten times from current levels.
“Even a modest branching out of gold as an ‘alternative’ currency and into Bitcoin over the longer term would imply Bitcoin’s price doubling or tripling,” JPMorgan said.
Over time, crypto could be held for reasons other than being a store of value as gold is, according to JPMorgan.

“Cryptocurrencies have intrinsic value and derive it not only because they serve as stores of value but also due to their utility as a means of payment. As the world adopts cryptocurrencies as a means of payment in the future, their utility and value will grow” JPMorgan explained.
Putting it simply, the risk is to the upside for Bitcoin.

The potential upside in the long-term for Bitcoin is considerable as it competes more intensely with gold as an ‘alternative’ currency. JP Morgan came to this conclusion as they see Millenials becoming a more important component of investors’ universe as time passes.
The long-term technicals are also pointing to a surge in Bitcoin.

Categories
Forex Market Analysis

Markets’ Attention On Summer


Weekly Update (July 9th – 13th)


Macroeconomic Outlook

Summer is in focus now, and with it, the attention on the multiple factors that will condition whether it will be a good summer for the markets or a bad one.

Nevertheless, all these factors that unnerve investors are reaching a final outcome.

  • Last week, the markets performed better as the matters that block them improved slightly.
    • European policy and German politics have reached an outcome.
    • Then oil, which is still a problem.
    • And protectionism which is something more bilateral between China and USA rather than global.
      • When the market realises that, it will care less about it.

We were expecting a hard summer, however, the markets are starting to react in a positive way sooner than expected.

This week has three main references:

  • On Tuesday, the German ZEW Economic Sentiment which is expected to be negative again for the fourth month in a row.
    • It is relevant enough to watch out for but nothing especially important as the overall German economy has been increasing recently at 2.5% in the last trimester, which is really good.
  • On Thursday, there is US Core CPI which is forecasted to rebound from 2,2 to 2,3. This issue depends mostly on oil prices.
    • Over-inflated data may hurt bonds, nevertheless structurally it will not be a real matter which could be solved in 2 or 3 months.
  • And the third reference is American corporate results which start, among the big ones, on Tuesday with Pepsi Co.
    • And on Friday, three big banks publish results
      • Citi / +23%
      • JP Morgan / +30%
      • Wells Fargo / +11% and with some legal problems
    • They are expected to be really solid which will support markets.

Hence, this week looks like where a more positive sentiment towards markets can be consolidated.

  • German political turmoil looks clearer than before.
    • Even though it will come back in October with the elections.
  • Regarding oil, American pressures regarding an increase in production are graspable which will lead to Saudi Arabia producing more, and reducing oil prices.
    • This will reduce inflation related concerns.
  • Then, there is the protectionism which is mostly between the USA and China, being something more local rather than something global.
    • So that, when the market realises that along with strong corporate results, a good economic growth and a lot of liquidity, it will lead to an overall favourable economic cycle which will support the markets.