JPM Coin Is A Direct Threat To Ripple, Crypto Community Takes A Dig At XRP As CEO Fires Back
JPM Coin Is A Direct Threat To Ripple, Crypto Community Takes A Dig At XRP
Recently we reported that there is a new “cryptocurrency” on the block and looks like it is putting the third largest digital asset XRP by a market cap of $12.4 billion at risk. One of the major banks, JPMorgan Chase rolled out its own so-called stablecoin JPM Coin that is pegged by one dollar. This would be used by the clients of the banks in cross-border payments, reportedly which is a direct threat to Ripple, according to Tom Shaughnessy, the principal at Delphi Digital, a crypto research firm in New York.
Ripple had been working on providing faster and cheaper payments across cross-borders and have claimed to already partnered with more than 200 banks. The company has been already competing with Swift, the traditional network that banks use and further aims to replace it.
However, given the fact that JPMorgan moves over $5 trillion in wholesale payments each day, the competition has become not just bigger but way tougher. “This is a huge slap in the face for Ripple,’’ said Shaughnessy. “Ripple’s target market is cross-border payments and remittances and now JPMorgan’s effort is a direct threat.’’
Travis Kling, the founder of Los Angeles-based hedge fund Ikigai Asset Management told Bloomberg,
“JPM’s project is much more evolutionary than revolutionary — it is utilizing a private, permissioned blockchain technology called Quorum, which is much closer to a Google Sheet than a Bitcoin. The project is clearly competing directly with Ripple Labs and their centralized cryptocurrency XRP.”
Ripple CEO: JPM Missing the Point
Meanwhile, Ripple CEO Brad Garlinghouse took to Twitter to share that it’s no big deal as he stated,
“As predicted, banks are changing their tune on crypto. But this JPM project misses the point – introducing a closed network today is like launching AOL after Netscape’s IPO. 2 years later, and bank coins still aren’t the answer.”
He also shared his LinkedIn article from 2016 titled, “The Case Against BankCoin,” where he had shared,
“A bank-issued digital asset can only really efficiently settle between the banks who issued it.” Then, two scenarios can play out.
Scenario one: all banks around the world put aside competitive and geopolitical differences, adopt the same digital asset, agree on its rules, and harmoniously govern its usage. Fat chance. Scenario two (the more likely scenario): “banks not in the issuing group issue their own digital assets with their own sets of rules and governance.”
He further stated that the result would be “even more fragmented currency landscape,” than what it has been at that time that will lead to several issues making a “mess” of things.
XRP Price Unaffected
At the time of writing, XRP has been trading at $0.302 with 24-hours gains of 0.02 percent. However, currently, the digital asset is about 90 percent down from its all-time of about $3 and this volatility, according to Shaughnessy could work in JPM Coin’s favor.
“The JPM Coin is a stable coin whereas XRP is anything but stable. That’s going to be a very contentious point for banks who don’t want the currency in which they make payments to be volatile.”