It’s been an interesting few weeks, watching bitcoin’s rollercoaster ride as it rises to valuations over $4,000 and then dives to almost $2,000 before rising again to near $6,000.
This is for an asset that just a year ago you could have purchased for a few hundred dollars. The rise of cryptocurrency valuations is confusing and fuelled by everything from China and Russia trying to ban the asset, to forks that offer you free cash and coins.
It is for these reasons that Jamie Dimon (CEO, JP Morgan) calls bitcoin a fraud …
… and Gottfried Leibbrandt (CEO, SWIFT) gets a big laugh from bankers by talking about bitcoin whilst showing tulips on a slide.
Bankers may laugh at bitcoin but they’re obviously conflicted. On the one hand, Goldman Sachs says that bitcoin is less reliable as an investment than gold, and then considers the launch of a new trading operation focused on bitcoin; whilst Morgan Stanley CEO James Gorman says that bitcoin is “certainly something more than just a fad.”
Maybe that’s because bitcoin was recently peaking at a market cap of almost $100 billion, making it more valuable than the market cap of Goldman Sachs or Morgan Stanley. And you do have to ask why JP Morgan is trading bitcoins on behalf of clients when Jamie Dimon said he would fire anyone at the bank trading in them.
It’s nice therefore to see some rationale in this haven of confusion. Adam Lutwin, CEO and co-founder of Chain, writes on Medium:
Let me start by stating that I believe:
