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Times Have Changed: JPMorgan Is Launching a Bitcoin Fund For Wealthy Clients

JPMorgan Chase & Co., an American investment bank and financial services holding company with assets worth over $3 trillion, have become one of the U.S. mega-banks to embrace crypto as an asset class. 

The investment bank, headquartered in New York City, revealed its plans to offer an actively managed bitcoin fund to only private wealthy clients.

According to information released to Coindesk citing different sources, the JPMorgan bitcoin fund will most likely become available to clients as soon as this summer, with institutional bitcoin shop NYDIG serving as the bank’s custody provider.

Times Have Changed at JPMorgan

The bank’s latest move is a sharp contrast to the CEO’s view of cryptocurrency some years back. Late in 2017, Jamie Dimon called bitcoin a dangerous fund and threatened to sack any of the bank’s traders who traded the cryptocurrency.

He also mentioned in a CNBC  session “If you’re stupid enough to buy it (Bitcoin), you’ll pay the price for it one day.”

However, last year, the US bank announced that it would start offering cash management services and processing dollar-denominated transactions for customers using Coinbase or Gemini cryptocurrency exchange to trade cryptocurrencies.

Later that year, JPMorgan revealed that it used an in-house developed blockchain application to execute intraday repo transactions between its affiliates due to technical inefficiencies that clients face. 

To eliminate the problems in the repo market that made it difficult for clients to use funds obtained in the market to meet their intraday liquidity needs, the bank used the Blockchain application. This step produced positive results as borrowers and lenders were able to conduct short-term intraday repo transactions and saw new ways to meet their intraday liquidity needs.

With the bank’s recent plans to release bitcoin funds, it has taken steps similar to that of Morgan Stanley. In a similar article, the American multinational investment bank, with assets worth $4 trillion revealed its intention to launch bitcoin funds to its wealthy clients owing to the increase in demand for the cryptocurrency by clients.

The bank will allow its clients to directly invest in two Bitcoin funds managed by Michael Novogratz’s Galaxy Digital, and another offered by FS Investments in collaboration with NYDIG.

JPMorgan’s bitcoin fund will be different from that of Pantera Capital and Galaxy Digital since it will be actively managed by the clients themselves.

 

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