Crypto Still ‘Far Off’ Until Its Mainstream According To JP Morgan

Shaun Williams

This is not investment advice. The author has no position in any of the stocks mentioned. has a disclosure and ethics policy.

Despite what seemed like swelling institutional support during the heady days of the crypto gold-rush in 2017, many larger institutions have slowed down the pace of adoption when it comes to currencies like Bitcoin, Ethereum, and Litecoin.

Take Blackrock(NYSE:BLK), a New York-based investment and asset management firm, for example. Last July Bitcoin was the lucky beneficiary of a wave of hype coming out of the firm, as multiple sources claimed that the firm had organized a team to investigate a large move into Bitcoin and other cryptos. Yet, just a few months later in November the firm publicly recanted from the position, and said they wouldn't offer a Bitcoin ETF until an undisclosed time in the future when things have become "legitimate".

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JP Morgan (NYSE:JPM) is no different their analysts today went on to detail why they think we are still several years away from seeing the technology become a mainstream investment and banking vehicle.

The analysts cited widespread confidence and trust in traditional assets such as gold, the dollar, and other instruments such as Federal bonds and treasury notes.

Even in extreme scenarios such as a recession or financial crises, there are more liquid and less-complicated instruments for transacting, investing and hedging. - JP Morgan

The bank cited institutional support as waning, saying that over the last six months or so, individuals have increased their share of the market compared to larger firms and banks. Pension funds were said to have been among the most resistant to adopting cryptocurrencies especially due to price volatility and the possibility of legislation hurting their value and stability.

JP Morgan also goes on to say that the usage of cryptos for payment systems is "challenged" due to the complexity inherent in the blockchain.

However, it's possible that JP Morgan and its analysts aren't as well-versed as some other authorities in the finance world and simply saying "its complex" doesn't really leave us with a whole lot. It's been demonstrated by many that the blockchain can greatly speed up and reduce costs in all manner of transactions.

Crypto will most likely need some solid legislation legitimizing it along with some regulation to govern how its handled as a currency before JP Morgan, Blackrock, and other large institutions buy into the world of cryptocurrencies



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