JP Morgan’s crypto project draws mixed reaction from industry
Mon, 18 Feb 2019, 03:47 am UTC
J.P. Morgan’s recently announced cryptocurrency project, ‘JPM Coin’ is drawing mixed reactions from the industry.
In a report dated February 14, Bloomberg cited a number of experts who see JPM Coin as a direct competitor of Ripple’s XRP token.
Calling the JPM project as “more evolutionary than revolutionary,” Travis Kling, the Los Angeles-based founder of crypto hedge fund Ikigai Asset Management, noted that the crypto is based on Quorum, a private, permissioned blockchain technology, which is much closer to a Google Sheet than a Bitcoin.
“The project is clearly competing directly with Ripple Labs and their centralized cryptocurrency XRP,” he said.
Tom Shaughnessy, principal at Delphi Digital, echoed similar views and said, “This is a huge slap in the face for Ripple. Ripple’s target market is cross-border payments and remittances and now JPMorgan’s effort is a direct threat.”
However, the crypto project has also drawn criticism with many believing that it is nowhere close to being called a cryptocurrency.
Ripple CEO Brad Garlinghouse voiced his views in a tweet saying that the project “misses the point.”
As predicted, banks are changing their tune on crypto. But this JPM project misses the point – introducing a closed network today is like launching AOL after Netscape’s IPO. 2 years later, and bank coins still aren’t the answer https://t.co/39EAiSJwAz https://t.co/e7t7iz7h21— Brad Garlinghouse (@bgarlinghouse) February 14, 2019
Well-known American economist Nouriel Roubini believes that JPM Coin cannot be even called a “crypto.”
In which way has the new alleged JPMorgan crypto coin anything to do with blockchain/crypto? It is private not public, permissioned not permissionless, based on trusted authorities verifying transaction not trustless, centralized not decentralized. Calling it crypto is a joke— Nouriel Roubini (@Nouriel) February 14, 2019
Read this an hour ago and I am still rolling laughing. JPM is launching a centralized, inflationary Coin and THIS will kill Bitcoin ? ???????? Its titles like these that indicate author has very little clue what he is talking about . If anything Bitcoin Dream just got stronger ! pic.twitter.com/Wy7Zxj9lUL— George Kikvadze (@BitfuryGeorge) February 14, 2019
In an online post, Jerry Brito, Executive Director of Coin Center, explains why JPM Coin is not a cryptocurrency.
“The main thing that makes a crypto a crypto is that it is built in such a way that anyone can use it and anyone can participate in its consensus system without seeking permission from anyone else,” he said. “That is certainly not what J.P. Morgan built, nor even what it wants to build…”
Brito further states that the bank should have announced the project as a new interbank settlement network, instead of a coin, adding:
“That framing could have avoided confusion, but I doubt it would have generated as much attention. This is just marketing you might think, but it matters.”
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