Mar 20, 2019 23:30 UTC
Mar 23, 2019 at 11:17 UTC
More Collaboration Than Competition Between Banks and Crypto, Says JP Morgan Exec
JP Morgan is making the headlights these days, especially with the launch of their JPM Coin. Now an executive of JP Morgan Chase executive has made an interesting remark regarding the relationshio between banks and cryptocurreny,
In an interview with CNBC’s Squawk Box on Mar. 20, JP Morgan’s Global Head of eCommerce Solutions Ron Karpovich said that there is “more partnership instead of competition” between existing financial establishments and the cryptocurrency market.
Karpovich told CNBC,
“Ultimately behind the scenes, they [crypto innovators] are going to have to use a bank to move funds. There’s more partnership instead of competition in that space. When it comes to margins and capabilities — payments is never something that grows in margin, nobody wants to pay for a payment. That’s one of the hardest parts of this process: you have limited resources in the capability to sell, so you need highly efficient and large players.”
His comments come on the heels of the recent announcement of the blockchain based JPM Coin that his bank has already began developing. That coin is supposed to function on J.P. Morgan’s internal payment network for clients.
While he talks about the increasing urge to reach out and forge ties between these two industries, he also claims that cryptocurrency innovators and entrepreneurs should avoid disregarding the banking industry comppletelygether, because at the end of the day they will have to depend on banks to move funds.
Karpovich also shot down the notion that JP Morgan had contradicted its own stance on crypto with the development of the JPM Coin. He said:
“I think there’s a difference between trading a cryptocurrency that’s in the market that’s ubiquitous versus using the technology to enhance your payments infrastructure. We look at the technology as being a means to doing things faster and cheaper: every CEO would like to make things faster and cheaper. So from that standpoint I think it represents a buy into the concept of using blockchain.”
He advocates the gradual incorporation of blockchain technology in back end development of things. He does envision a future where blockchain would become a mainstream payment processing technology.