The CEO of JPMorgan Chase, Jamie Dimon, has yet again commented on the ongoings in the cryptocurrency space. This time, he has commented on his beliefs that Facebook’s Libra won’t be a short-term impact on the banking system.
JPMorgan Chase is the leading bank in the U.S. in terms of retail deposits. Dimon says that it’s too early to talk about the main characteristics of Libra, such as globality and availability for the unbanked and how that could impact banks like his own.
“We’re going to be talking about Libra three years from now. I wouldn’t spend too much time on it. […] To put it in perspective, we’ve been talking about blockchain for seven years and very little has happened,” says Jamie Dimon when talking about Facebook’s Libra and Blockchain in general.
Earlier, Jamie Dimon has admitted that he believes cryptocurrencies might compete with legacy banks, explaining that they “don’t mind competition”, but highlighting that there needs to be certain rules and regulations:
“Governments are going to insist that people who hold money or move money all live according to rules where they have the right controls in place; no-one wants to aid and abet terrorism or criminal activities.”
JPMorgan Chase is one of the first traditional banks which went on and issued it’s own cryptocurrency – JPM Coin. It is meant to speed up internal transactions.
Libra Hearing in the House Of Representatives
Just recently, The House of Representatives held a hearing on Facebook’s Libra “cryptocurrency” and David Marcus, the head of Calibra, was there to comment and reply to all the questions of the senate. All-in-all, it was better for Bitcoin rather than for Libra.
However, David Marcus held a pretty good character and answered all the questions with ease and wit. The takeaway is that Libra won’t compete with other national currencies, such as the dollar. The reason being that it will be completely stable and won’t be seen as an investment opportunity.
However, knowing how stablecoins have operated up until now, none has succeeded to remain completely stable without any fluctuations.
“For every account open in Calibra, we’ll make sure that KYC is done. The approach that Libra is taking is using blockchain as an additional reinforcement. We will file every suspicious happening,” commented David Marcus.
But according to this, the senate commented on a specific problem – they highlighted the fact that the unbanked are unbanked for a reason. That reason being that they don’t have a valid personal ID. And if Calibra or Libra can be used only when you pass all the KYC and AML rules, this doesn’t go together with the advertised plan to bank the unbanked.
“You have to understand, that, if we don’t lead in this space – others will. Libra is an alternative with which consumers will have the ability to use the wallet. If we stay put, in 15 years, we’ll have half of the world operating on blockchain technology, and half of the world will be blocked. we don’t want that,” explained Marcus.
While David Marcus did a great job answering all the questions what the Senate asked, Representative Maxine Waters recently commented that her committee wants to call in Mark Zuckerberg, the CEO of Facebook, to testify about Libra.
