JPMorgan Chase CIO: ‘Blockchain Will Replace Existing Technology’

Lori Beer, JPMorgan Chase's global chief information officer (CIO), said at a press conference last week in Buenos Aires, Argentina, that "blockchain will replace existing technology", according to a report published on 23 August 2018 in Spanish-language blog "Crypto247".

JPMorgan Chase, which is the largest U.S. bank (and the most vaulable bank in the world by market capitalization), on May 2015, announced the opening of a new global service center in Buenos Aires. The city was chosen due to its efficient and well-trained labor market, its very cheap real estate, and having the same time zone as a large number of markets where the bank operates. This service center would have around 1000 employees and provide operational and technological support to the bank’s offices in over 100 countries.

At the press conference on 23 August 2018, according to a report by local news outlet "El Cronista", Beer said that by next year, this service center would be employing 2000 people, half of whom would be dealing with technological issues. She also said that JPMorgan thinks of itself as a "digital bank", which is a "reflection of the importance that technology has today for the banking industry." To give the audience an idea of the scale she was talking about, she gave these figures:

  • Over $10 billion a year spent on technology ($700 million a year on cybsersecurity alone)
  • Out of its 250,000 employees, more than 50,000  work in the technology area

Beer also talked about artifcial intelligence, blockchain technlogy, and cryptocurrencies.

"El Cronista" attributes this quote to Beer:

"Artificial intelligence will greatly improve our processes in relation to fraud and cybersecurity, and we are evaluating the opportunity to take advantage of blockchain, but we believe that its greatest value will be seen in a few years."

"Crypto247" provided more extensive reporting on Beer's comments on these subjects:

“We will see a greater and wider use of blockchain... In a few years blockchain will replace the existing technology, today it only coexists with the current one."

"We are following multiple paths, we invented a blockchain in open source Ethereum, the existing blockchain technology had not solved the issue of privacy and scalability that we needed, we are connected to Hyperledger and the Enterprise Ethereum Alliance. more important the implications for the business than the technology specifically, we seek not only cost reduction but opportunities for the development of new products."

When asked what would happen if a client of the bank asked one of its financial advisors about the possibility of buying crypto, Beer said that the bank only "supports everything that is regulated" and that they have "specialists evaluating what is happening."

JPMorgan's main product in the blockchain space is Quorum, an enterprise-focused permissioned version of Ethereum.