JPMorgan Chase follows Bank of America who said in their annual report that some customers were leaving for crypto. JP Morgan last month stated that blockchain has vast potential and many areas of application
JPMorgan Chase has released an annual report citing cryptocurrency as risk factors for its business. The bank recognizes cryptocurrency as a competition that could give it a run for their money.
It is happening for the first time. It comes after the bank issued a separate 71-page document last month detailing the technology behind cryptocurrencies and saying it has vast potential.
The annual report says,
“Both financial institutions and their non-banking competitors face the risk that payment processing and other services could be disrupted by technologies, such as cryptocurrencies, that require no intermediation.”
In its earlier February document on cryptocurrency, the bank played down the threats saying such disruption would not come so quickly. However, it said the technology is not possible to ignore.
“We would note that it is not pre-ordaining that cryptocurrencies will succeed as there are valid concerns about what economic value they contribute. But in a time of rapid innovation, many new products will are often-and-errored. We believe the potential disruption from Blockchain cannot be ignored.”
The bank said cryptocurrencies have large applications where traditional banking systems are inadequate.
JP Morgan Chase caught the attention of crypto enthusiasts last year in contrasting statements. However, the bank revised its position about cryptocurrencies. It later announced it could allow customers to trade in Bitcoin futures.
The bank says in its annual report that it had to adapt by modifying its products to attract and retain customers. This was also an attempt to compete with new offerings from tech startups. It says this trend will continue.
Bank of America also noted crypto as risky
Another competitor, Bank of America also admitted in its annual report last week that some customers were leaving for products and services that the bank referred as speculative or risky such as cryptocurrencies.