On Monday (April 4), JPMorgan Chase Chairman and CEO Jamie Dimon talked about blockchain technology and decentralized finance (DeFi) in his company’s latest annual Letter to Shareholders.

In section “Investments and Acquisitions: Determining the Best Use of Capital and Assessing ROIs” of this report, he stated:

We now process payments for eight of the top 10 global Big Tech companies (up from three out of 10 companies five years ago), consistently winning business from strong competitors. We continue to bring to the market and commercialize innovative products, such as embedded banking; AI-driven fraud controls and forecasting; and account validation and programmable payments on JPM Coin.

Decentralized finance and blockchain are real, new technologies that can be deployed in both public and private fashion, permissioned or not. JPMorgan Chase is at the forefront of this innovation. We use a blockchain network called Liink to enable banks to share complex information, and we also use a blockchain to move tokenized U.S. dollar deposits with JPM Coin.

We believe there are many uses where a blockchain can replace or improve contracts, data ownership and other enhancements; for some purposes, however, it is currently too expensive or too slow to be deployed.

We expect to achieve double-digit market share over time in Payments, being the world’s most innovative bank, as well as the safest and most resilient.

On February 15, J.P. Morgan revealed its interest in the metaverse by releasing a research report titled “Opportunities in the metaverse” and establishing a virtual presence in Ethereum-powered virtual world Decentraland.

J.P. Morgan’s 18-page report, which examines the “exciting opportunities” the metaverse “presents for consumers and brands”, was produced by its blockkchain division Onyx.

Here is how they explained what the metaverse is:

The metaverse is a seamless convergence of our physical and digital lives, creating a unified, virtual community where we can work, play, relax, transact and socialize. The metaverse is still early in its evolution, and there is no singular, all-encompassing definition to which people can turn. Themes of what the metaverse is and could be, however, are emerging.

A key point is that there is no one virtual world but many worlds, which are taking shape to enable people to deepen and extend social interactions digitally. This is done by adding an immersive, three-dimensional layer to the web, creating more authentic and natural experiences.

Here are some numbers mentioned by the Onyx team to give everyone an idea of the opportunities the metaverse offers:

  • Transact — “Every year, $54 billion is spent on virtual goods, almost double the amount spent buying music
  • Socialize — “Approximately 60 billion messages are sent daily on Roblox
  • Create — “GDP for Second Life was about $650M in 2021 with nearly $80M USD paid to creators
  • Own — “Non-fungible tokens (NFTs) currently have a market cap of $41 billion
  • Experience — “200 strategic partnerships to date with The Sandbox, including Warner Music Group to launch a music-themed virtual world

Near the end of the report, they talked about their approach to the metaverse:

The success of building and scaling in the metaverse is dependent on having a robust and flexible financial ecosystem that will allow users to seamlessly connect between the physical and virtual worlds. Our approach to payments and financial infrastructure will allow that interoperability to grow.

We believe the existing virtual gaming landscape (each virtual world with its own population, GDP, in-game currency and digital assets) has elements that parallel the existing global economy. This is where our long-standing core competencies in crossborder payments, foreign exchange, financial assets creation, trading and safekeeping, in addition to our at-scale consumer foothold, can play a major role in the metaverse.

We are building and scaling new emerging technologies to modernize infrastructure and business models including but not limited to tokenization and digital identity, as we strive for perpetual innovation and better ways to organize financial transactions and payments in the decentralized web.

On the same day, JPMorgan also announced that it had become the first major bank to enter the metaverse by establishing a virtual presence called “Onyx Louge” in Decentraland. As The Block reported, this location “features an image of bank CEO Jamie Dimon, which transforms into a jpeg image of Onyx’s Christine Moy.” Moy is Global Head of Liink, Crypto & Metaverse at Onyx.

On 15 January 2021, during the JPMorgan Chase Q4 2020 Earnings Call, CFO Jennifer Piepszak and CEO Jamie Dimon talked about blockchain technology and the “very very tough competition” in the next 10 years against FinTech firms.

During the Questions & Answers segment of the conference call, Charles Peabody, President of Portales Partners, asked the following questions:

Good morning. I have a couple of questions related to FinTech, and unfortunately, I was born in a wrong generation, so I need a lot of help. How dependent is the FinTech world on the banking system? As I understand, they lay on top of the pipes and the plumbing of the banking system. Do you have any leverage in a competitive world against the FinTech world?

And then, secondly, I noticed that the OCC gave banks the green light to use public blockchain networks and stablecoins. Can you explain what importanance that has to JP Morgan?

The JPMorgan Chase CFO replied:

Oh, OK, sure. That guidance enables an offering of stablecoins on a public blockchain. That doesn’t impact JPM Coin. JPM Coin, you should think about as the tokenization of our customer deposits.

It’s obviously very early. We will assess use cases and and customers demand. But it’s still too early to see where this goes for us.

And the JPMorgan Chase CEO added:

And we are using blockchain for sharing data with banks already, and so we are at the forefront of that, which is good. The other question was about FinTech… Look, first of all, they are very good competitors… They are strong. They are smart. Some effectively ride the rails. So we bank a lot of them. You know, we help them accomplish what they want to accomplish…

My view is we are going to compete –we need to — and we have to look at our split inside of what we could do better, or could have done better, and things like that. So I am confident we will compete, but I think we now are facing a whole generation of newer, tougher, faster competitors who if they don’t ride the rails of JP Morgan, they can ride the rails of someone else…

I have told you before: everyone is going to be involved in payments. Some banks going to white label, which makes FinTech competitors white label banks and build whatever service on top of it, and we have to be prepared for that. I expect it to be veryvery tough competition in the next 10 years. I expect to win. So help me God.

Peabody then had this follow-up question:

So do they need the banking system to complete their loop of service or can they work completely outside the bank?

Dimon replied:

Well, most of them will do for now, but I think it’s a mistake to say it’s going to be forever. They’re getting bank licenses. Utah is giving industrial licenses. Like I said, banks are white labeling. So, it’s effectively the same thing…

If a FinTech company uses a white label bank just to process their business, they’re basically a bank. You know, what the regulator will do, I don’t know, but we have to assume that they are going to do it. And that some will find ways not to use the banking system, which they have done… I am not against that. The regulators may have a point of view about that one day, but I am less worried about that. I am going to worry about us.

The JPMorgan Chase CEO has long been a fan of blockchain technology but not cryptocurrencies. In fact, he called Bitcoin a “fraud” as early as September 2017. 

According to a report by Bloomberg, on 13 September 2017, after calling Bitcoin “a fraud”, Dimon went on to say that Bitcoin was “worse than tulip bulbs.” And if a JPMorgan trader began trading in Bitcoin, Dimon said that he would “fire them in a second.”

He went on to say that:

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 U.S. dollars. So there may be a market for that, but it’d be a limited market.

On January 2018, in an interview with FOX Business’s Maria Bartiromo, Dimon said that he regretted his previous comments about Bitcoin, and expressed his faith in blockchain technology:

The blockchain is real. You can have crypto yen and dollars and stuff like that. ICO’s you have to look at individually. The bitcoin to me was always what the governments are gonna feel about bitcoin as it gets really big, and I just have a different opinion than other people. I’m not interested that much in the subject at all.

In an interview with the Harvard Business Review (July–August 2018 Issue), here is what Dimon had to say about crypto:

I probably shouldn’t say any more about cryptocurrency. But it’s not the same as gold or fiat currencies. Those are supported by law, police, courts. They’re not replicable, and there are strictures on them. Blockchain, on the other hand, is real. We’re testing it and will use it for a whole lot of things.


The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.