If 2021 teaches anything about cryptocurrencies, it is that big banks and major payment providers are now more comfortable with Bitcoin (BTC). While executives at PayPal and other large companies have expressed enthusiasm about cryptocurrencies and the salaries paid in bitcoin, executives at Visa, JPMorgan and ING agree that Bitcoin remains an investment tool and not a currency.
This finding was featured in a panel discussion titled “Buying with Bitcoins”, held during the Forbes Online Event “2021 Blockchain 50 Symposium: Crypto Goes Corporate”. The discussion was moderated by Michael Del Castillo, Assistant Editor for Forbes, and joined by Omar Farouk, CEO of JPMorgan Onyx Blockchain; Mariana Gomez de la Villa, Distributed Ledger Technology Program Manager, ING; And Kai Sheffield, Vice President and Head of Cryptocurrency at Visa.
Have bitcoin payments made since 2014?
When asked if anything has changed bitcoin payments since 2014, the three leaders indicated that the main use case of Bitcoin is still a store of value. Farouk noted that accessibility is the only major change that has occurred in Bitcoin payments since 2014:
Square and PayPal, for example, make Bitcoin easier to use. Although, I believe bitcoin payments remain a marketing game for many large companies. ”
While Farouk mentioned that consumers can certainly pay for commodities that use Bitcoin, volatility is a big problem. He also noted that the tax implications are more difficult when it comes to cryptocurrencies.
Sheffield noted that Visa is seeing increased demand from customers looking to access Bitcoin, but that the digital currency is still seen by many as a “savings account.” As such, Sheffield explained that Visa is currently focusing on “summarizing prices” or enabling customers to purchase small units of bitcoin with overtime. Companies like Fuld allow customers to use paper money and then earn bitcoins again. That was our main motivation, he said.
Echoing Farouk and Sheffield, Gomez de la Vella noted that Bitcoin is still an investment, mainly due to issues such as the continued high transaction fees. “I don’t think Bitcoin will be widely used as a payment method at this time,” she said.
JPM Coin is not a cryptocurrency
Given the sentiments expressed by all three shareholders of the Bitcoin payments, it should come as no surprise that Farouk mentioned that JPM Coin – the JPMorgan digital currency offering announced in 2019 – is not a cryptocurrency.
Instead, Farooq explained that JPM Coin was created specifically to meet the needs of JPMorgan’s Fortune 500 and Fortune 1000 corporate customers. Our customers want access to programmable money, conditional payments, and future opportunities. But they don’t care much about being in a fully decentralized, autonomous public network. ”
Farooq noted that JPM Coin provides companies with payment options in the future, but it works more like M1 numbered or an amount of money usually issued by banks. He said:
“We believe that companies can come and interact on the platform to execute decentralized transactions in the wider ecosystem so that they can access programmable funds. JPM Coin is not a pure cryptocurrency because, in my opinion, a pure cryptocurrency is something of independent value in a public blockchain like Bitcoin or Ether. ”
In addition to JPM Coin, Farouk talked about the rationale behind the recent round of $ 65 million investment in ConsenSys, led by major financial institutions including JPMorgan. The new funding will help expand its blockchain infrastructure solutions to enable more decentralized financing and Web 3.0 applications on Ethereum, according to software company ConsenSys. In light of this announcement, Del Castillo asked Farouk if JPM Coin is a competitor to Ether (ETH).
According to Farouk, JPM Coin is not competing with Ether, stating that JPM Coin caters specifically to JPMorgan’s clients, not retail investors. Farouk also mentioned that while JPMorgan built the Quorum platform on Ethereum, which is now ConsenSys Quorum, the idea was to merge the two platforms to allow the creation of JPMorgan’s blockchain solution on the network ConsenSys was working on. “We have a good relationship with ConsenSys and will continue to work with them in the area of core technology,” Farouk said.