Seemingly the voice of the musty old traditional bankers, Jamie Dimon’s vitriol about Bitcoin a few months back set the tone for opinions of that breed of traditionalist. There is opposition of course, but unsurprisingly the opposition is also coming from the younger, more modern thinkers.
Revolut, a digital banking alternative, CEO Nikolay Storonsky, disagree with Dimon’s famous words of ‘Bitcoin being a fraud.’ Indicating that the mobile-only banking solution is looking at launching cryptocurrency support by December.
Old vs. New
As the rhetoric and vitriol spouted against Bitcoin by bankers start to sound repetitive and a bit stale, it is becoming increasingly obvious that there is fear and uncertainty in the marketplace. Banks have had a monopoly over money for more than a century, yet there is disruption on its way.
That monopoly is now being challenged, firstly by technology such as cryptocurrencies and their influence as a digital alternative to fiat. As well as by startups like Revolut, who are behind Bitcoin and its related coins, and who are trying to change the established banking model.
Not a fraud, more like gold
In Storonsky’s opinion, Bitcoin is far from being a fraud, as Dimon puts it, but he rather sees the coin being like gold - and there is strong arguments that Bitcoin is becoming a digital gold as it evolves.
"They are definitely not a fraud," Nikolay Storonsky said.
He went on to add that he believed that people are less likely to use Bitcoin for everyday transactions, but that does not count against the original digital currency.
Many are touting Bitcoin Cash as the alternative to Bitcoin that has the ability to be used like cash, with its lower transaction fees and quicker times. Yet, despite less real-world application for Bitcoin, there is huge value in it.
"Real-world usage for gold is quite limited. But still there is a huge market, huge volumes that are being traded in the market and these volumes determine the gold price," Storonsky said.
"The question, 'Where is the real gold price?' No one knows. It's the same with Bitcoin. Volumes are increasing, the price is shooting up, there is no implication of Bitcoin in the real world, it's quite limited."
Changing the mindset
While Dimon and his cronies sit on one side of the Wall Street divide, the lines are softening. The usual calls have been that Bitcoin is in a bubble, while others have literally said that the bubble is only beginning.
Credit Suisse CEO Tidjane Thiam has said:
“From what we can identify, the only reason today to buy or sell Bitcoin is to make money, which is the very definition of speculation and the very definition of a bubble."
But on the other side of things, Mike Novogratz agrees there could be a bubble, but there's also money to be made.
“Prices are going to get way ahead of where they should be. You can make a whole lot of money on the way up, and we plan on it.”
What is clear despite the back and forth between the bankers, is that Bitcoin is a force that should be taken seriously, it no longer lacks credibility and is infiltrating the market. Even the bigwigs at Goldman Sachs have changed their tune stating:
“With the total value nearly $120 bln, it’s getting harder for institutional investors to ignore cryptocurrencies. There are currently over 800 cryptocurrencies out there, though just 9 have a market cap in excess of $1 bln.”
Those figures are already very outdated...