LUCKNOW (CoinChapter.com) — JPMorgan CEO Jamie Dimon’s crypto statement provoked criticism from the sector’s hardcore proponents this week. Notably, Dimon denounced Bitcoin and crypto as primarily useful tools for criminals while speaking before the US Senate Committee on Banking, Housing, and Urban Affairs on Dec. 5.
“The only true use case for it is criminals, drug traffickers, money laundering, tax avoidance.” He went so far as to say “If I were the government, I’d close it down.”
Dimon stated
Is Jamie Dimon Crypto Comments Hypocritical?
Many crypto experts and commentators pointed out JPMorgan‘s long record of fines and violations. According to Good Jobs First’s violation tracker, JPMorgan is the second most penalized bank at $39.3 billion since 2000. Most of these fines — around $38 billion worth — came under Jamie Dimon’s leadership as CEO starting in 2005.
Crypto lawyer John Deaton criticized Dimon’s remarks in a Dec. 6th social media post, arguing that the CEO demonstrated hypocrisy, given JPMorgan’s history of violation.
VanEck strategy advisor Gabor Gurbacs expressed a similar sentiment, stating:
“Jamie Dimon is in no position to criticize [crypto like] Bitcoin with this track record.”
He further said that global banks have incurred $380 billion in fines this century.
JPMorgan’s Track Record: A History of Controversial Fines
Several major controversies have fueled these massive fines.
In September 2023, JPMorgan agreed to pay $75 million to settle a lawsuit brought by the US Virgin Islands alleging that between 2002 and 2005, the bank facilitated cash transactions and provided other financial services that enabled Jeffrey Epstein’s sex trafficking operation.
The settlement agreement states that JPMorgan did not admit guilt or liability for the allegations. Legal experts note that settlements, which avoid prolonged litigation, do not necessarily indicate an admission of wrongdoing.
Where was Jamie Dimon’s crypto logic, then?
In October 2013, JPMorgan paid $13 billion to settle allegations that they misled investors about risky mortgage securities. This was the largest fine ever in the bank’s history.
Where was Jamie Dimon’s crypto logic, then?
Between 2008 and 2016, JPMorgan traders were found to have manipulated precious metals markets. The bank agreed to pay $1 billion in fines to settle the case in 2020.
Additionally, in July 2019, over 20 tons of cocaine (valued at $1.3 billion) was seized from a ship owned by the JPMorgan fund.
Where was Jamie Dimon’s crypto logic, then?
Are Jamie Dimon’s Crypto Statements Even Aligning with Crypto Activity?
Despite calling for a government ban on cryptocurrencies at the hearing, JPMorgan has developed some blockchain and crypto-related products.
Dimon stated: “If I were the government, I’d close it [crypto] down” to Senator Elizabeth Warren.
However, in apparent contradiction, JPMorgan launched JPM Coin in 2019 — a digital token created for institutional clients on a private Ethereum blockchain.
JPMorgan also rolled out a tokenization platform in October, supported by client BlackRock, and contributed funding to Ethereum infrastructure company Consensys in April 2021, showing some embrace of crypto and blockchain technology.
Jamie Dimon’s crypto irks expand when it comes to decentralized cryptocurrencies like Bitcoin, which he compares to Ponzi schemes. His stance suggests he was making this distinction again at the recent hearing.
Dimon’s crypto ban call has prompted some experts to argue that the decentralized design of cryptocurrencies like Bitcoin would make an effective government ban impractical.
Additionally, some social media forum moderators labeled Dimon’s comments about illicit crypto activity as misleading, with posted fact checks stating that less than 1% of cryptocurrency transactions are tied to illegal purposes.
