Nothing about Jamie Dimon’s anti-Bitcoin explosion (“Bitcoin is a fraud”) made sense. The timing was weird. After all, Bitcoin has proven itself the world over since its first proof-of-concept back in October 2009. There was no real news out there that would have prompted the CEO of JP Morgan to blow up in a rage and say the following:
“The currency isn’t going to work. You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart.
If you were in Venezuela or Ecuador or North Korea or a bunch of parts like that, or if you were a drug dealer, a murderer, stuff like that, you are better off doing it in bitcoin than US dollars. So there may be a market for that, but it would be a limited market.
It is worse than tulip bulbs. Don’t ask me to short it. It could be at $20,000 before this happens, but it will eventually blow up. Honestly, I am just shocked that anyone can’t see it for what it is.”
His rant concluded with a not-subtle threat to fire any employee who is playing around with Bitcoin – an act which would slice off the best and brightest from the firm.
Rage for His Machine
You might notice something odd about all this screaming. It has no substantive content. Not one refutable argument. Bitcoin is a currency, perhaps the most valuable currency in the world, thousands of times more valuable per unit than the dollar. His view that nothing valuable can be created by digits is ridiculously old-fashioned. There were countless attempts to create money before Bitcoin and they all failed for specific technological reasons.
And Bitcoin is not created out of thin air. It is created by processing power using real resources to confirm transactions on the first global decentralized ledger that keeps track of ownership rights (which is something humanity must do to progress). That something like that could port value out of Venezuela or North Korea into another place is actually notable and emancipatory.
But if you want to talk about money created out of thin air, how about the trillions created by the Fed in 2009 that was used in part to bail out JP Morgan? In fact, the bailouts of Morgan began before most of the rest of the country knew there was a housing crisis in 2008. But actually, this isn’t particularly new: Morgan has been working tightly with government for more than a century.
You know, it is pretty darn obvious: Jamie Dimon doesn’t know, and doesn’t want to know, anything about Bitcoin. That’s no crime. But to speak about the subject as if you are an authority is pathetic.
So why did he do it?
He himself admits what happened. He spoke to his daughter, maybe over dinner, and she bragged about owning Bitcoin and how it is going up.
“It went up and she thinks she’s a genius now,” he raged.
So big, powerful, rich dad decided to put this stupid kid in her place. He blew up. Plus he must have wondered where she got some exotic monetary tool. For his part, he would have no idea where to get cryptocurrency or what to do with it.
Maybe she got it at one of the thousands of ATMs around the country?
Guys like Dimon believe they own the system. They are the great intermediaries. The masters of the monetary universe. No one gets in the system or out of the system without their knowledge and permission. So it has been for thousands of years.
Bitcoin changes all that. Download a wallet, find a friend, and you are the owner of a currency that can buy anything in the world, from anywhere in the world. It’s more than that: any individual can raise capital, without intermediaries. Without JP Morgan.
Let’s just say that Mr. Dimon has a slight conflict of interest here. He is right to fear for the obsolescence of his job.
And this might explain his anger issues. I’m guessing that the daughter can confirm this.
This much is sure: his daughter knows more about the modern world than he does. I bet she is better at Instagram, too.
Maybe she should be CEO of a newly reconstituted JP Morgan, one focused on modernizing money and finance rather than holding us back in exploitative structures that are being displaced.