Garlinghouse is not Impressed!
The announcement of JPMorgan’s JPM Coin triggered a storm of controversy and mixed opinions throughout the crypto and financial communities alike, mainly for its centralized structure and Jamie Dimon’s controversial approach to Bitcoin.
At the DC Blockchain Summit earlier this week, featured speaker and Ripple CEO Brad Garlinghouse took the opportunity to share his thoughts on JPM Coin and JPMorgan’s interest in blockchain and cryptocurrencies:
“I think it’s great for the blockchain and crypto industry to have players like JPM leaning in. Thumbs up. That’s great. That’s the only nice thing I’m going to say about this.”
While acknowledging that interest from leading financial institutions is ultimately a positive step for digital assets and blockchain tech, that was as nice as it got from the Ripple CEO, who then weighed in on the functionality of the new coin:
“If you give them a dollar for deposits, they’ll give you a JPM Coin that you can then move within the JPM ledger.
Wait a minute, just use the dollar! I don’t understand. If you’re just moving within the JPM ledger, and it has to be dollar-to-dollar, one-to-one backing, I don’t understand what problem that solves.”
XRP Vs. JPM Coin – Do They Actually Compete for the Same Clients?
Since JPM Coin was unveiled to the world, pundits have theorized about how Ripple’s goal of getting institutions to use the XRP ledger (RippleNet) to solve inefficiencies in payments could be in danger. Garlinghouse’s strong stance could be a reaction to show strength to rivals and critics, but if we look deeper, the two cryptocurrencies may not directly compete (YET).
At the beginning of March, Binance released a detailed analysis on JPM Coin and its potential impact on the digital asset markets and Ripple.
To put things into perspective, JPM Coin’s potential circulating supply and impact on the stablecoin market could mean that leading USD tokens are dwarfed due to the immense capital of JPMorgan and its vast number of institutional clients that are now exposed to utilizing the JPM Coin.
While the report states that XRP and JPM Coin are not directly competing in the short-term, future developments with JPMorgan expanding the reach of its JPM Coin outside of its existing network will determine if the two will compete.
“Looking back at the Ripple ecosystem and the xRapid infrastructure, XRP works in a similar manner as USD in the traditional financial system: it acts as the mediator currency between both fiat / crypto currencies and any fiduciary product (e.g. commodity, points, miles, etc.).
This allows various closed system networks (such as JPM Coin) to interact with each other, with XRP acting as a bridge between these networks.” – Binance JPM Coin Report, Section Five
This is not investment advice; please always do thorough research and only invest what you are willing to lose, especially in times of uncertainty.