Rat poison square…dementia…as bad as trading freshly harvested baby brains…tulips…a bubble…a fraud…
Yep…if you haven’t guessed it yet, we are talking about cryptocurrencies.
In fact, we are listing just a few of the things people in the financial industry have said about them over the last year or so. And, as you can see, they have had quite a lot of (nasty) things to say.
Stuff like ‘it’s more expensive than rat poison’, or ‘it’s like everybody else is trading turds and you don’t want to be left out’.
But, while some are still dissing cryptos publicly, others are starting to change their minds…
…And some are even starting to get involved.
Goldman Sachs takes a risk on bitcoin
Take Goldman Sachs, for example.
Back in November, Goldman’s US chief executive said bitcoin was a ‘vehicle to perpetrate fraud’.
Fast forward to 3 May, and Goldman has changed their mind. They no longer think bitcoin is a fraud, in fact, they have plans to start trading into this space.
As reported by The New York Times:
‘But Goldman Sachs, perhaps the most storied name in finance, is bucking the risks and moving ahead with plans to set up what appears to be the first Bitcoin trading operation at a Wall Street bank.
‘In a step that is likely to lend legitimacy to virtual currencies — and create new concerns for Goldman — the bank is about to begin using its own money to trade with clients in a variety of contracts linked to the price of Bitcoin.
‘While Goldman will not initially be buying and selling actual Bitcoins, a team at the bank is looking at going in that direction if it can get regulatory approval and figure out how to deal with the additional risks associated with holding the virtual currency.’
Goldman’s backed start-up, Circle, has recently acquired Poloniex, one of the largest crypto exchanges.
Why Goldman’s turnaround?
Well, one of Goldman’s executives involved in the process said the bank had been ‘inundated’ with client requests.
Will Facebook create their own crypto?
Another who may be changing its tune is Facebook.
Back in January, Facebook banned all ads for cryptocurrencies and ICO providers on the grounds that they are ‘frequently associated with misleading or deceptive practices’.
Yet now there are reports that Facebook may be looking to launch its own crypto…
Here is what Coin Telegraph recently reported:
‘According to Cheddar’s anonymous sources, people “familiar with Facebook’s plans,” the social media giant is “very serious” about plans to launch an in-app virtual coin.
‘The unconfirmed information comes the same week the platform announced that David Marcus, head of its Messenger app, would transfer to heading a dedicated blockchain research group.
‘Marcus’ appointment to Blockchain operations was immediately conspicuous, the executive previously having worked in the finance sphere for PayPal and subsequently joining US cryptocurrency exchange Coinbase’s board in December 2017.’
JP Morgan file patent for blockchain tech
Or even JP Morgan…
As you may recall, the company’s CEO Jamie Dimon famously called bitcoin a ‘fraud’. He said he would fire any employee trading bitcoin for being ‘stupid’.
Dimon has since said he regretted making this statement.
In their annual report released in February, JP Morgan recognised cryptos as competitors that have ‘required the company to invest in adapting or modifying its products to draw and retain customers, and to compete with new offerings from tech upstarts, a trend it expects to continue.’
And JP Morgan has recently filed a patent to use bitcoin’s underlying technology, blockchain.
As reported by Fortune:
‘The patent was originally submitted in October, but the application was made public by the U.S. Patent and Trademark Office on Thursday. It outlines a system that would essentially use distributed ledger technology, such as blockchain, to keep track of payments sent between financial institutions.
‘In the application, J.P. Morgan notes that cross-border payments require “a number of messages” that must be sent between the bank and clearing houses involved in the transaction. This often results in delays and a restricted availability to the funds. Rather, the transaction on the blockchain would eliminate high costs, provide a system for accurately logging the transactions, and process payments in real time with a verifiably true audit trail.’
Prominent investors keep on publicly dissing bitcoin. Yet we see signs everywhere that cryptos and blockchain are infiltrating the financial industry.
You only need to take a look at the latest news.
Like the fact that CBA’s chief financial officer, Rob Jesudason, has just resigned his job to join Block.one. Block.one is an open-source software publisher specialising in blockchain. They also issue the EOS token, ranked fifth by market cap.
Or the fact that Bloomberg has partnered with Galaxy Digital Capital Management LP — a digital asset management firm — to launch the Bloomberg Galaxy Crypto Index [BGCI]. The index tracks the performance of the largest cryptocurrencies traded in US dollars.
Or that Thailand has just put in new laws to regulate cryptos and ICOs. This is after the central bank had banned banks from investing or trading in cryptocurrency back in February.
That’s right. More keep jumping into this space.
We are not sure what the future of blockchain will look like, or which cryptos will be leading the way.
But we sure see increasing evidence that they are here to stay.