Most crypto assets on the market are ‘garbage’, and real use cases for digital currencies are not sufficiently developed. This view, expressed by Umar Farouk, head of JPMorgan’s Onyx blockchain division.
At a Green Shoots seminar organised by the Monetary Authority of Singapore, he noted that regulation lags behind the growth of the industry. This is deterring many traditional financial institutions from participating in the market.
“The vast majority of cryptocurrencies are still garbage, actually. With the exception, I would say, of a few dozen tokens. Everything else that was mentioned is either noise or simply will go away,” Farouk said.
The Onyx CEO also believes that crypto-industry technologies have not yet matured enough to be usable in TradFi. For example, to conduct costly transactions between institutions or to issue products such as tokenised bank deposits, Farouk clarified.
“You need all of these things to mature so that you can build a product with them. Right now we have not yet reached that point. A large portion of money in Web3 today—in the current infrastructure—is used for speculative investments,” he emphasised.
In October 2020, JPMorgan revived the JPM Coin stablecoin project and created the Onyx division with approximately one hundred employees under Farouk.
In March 2021, the financial holding opened more than 50 vacancies related to blockchain. Four months later, JPMorgan further expanded hiring of specialists in the technology sector.
In April, JPMorgan CEO Jamie Dimon acknowledged the value of blockchain and DeFi applications.
Read ForkLog’s Bitcoin news on our Telegram — cryptocurrency news, prices and analysis.