Most cryptocurrencies are junk according to JPMorgan Chase, the largest bank in the United States. Most crypto doesn’t have a real use case and will eventually disappear, says Umar Farooq, head of digital assets at JPMorgan.
Farooq spoke on August 29 during a panel of Green Shoots, a financial technology (fintech) festival in Singapore. This event was organized by the Monetary Authority of Singapore (MAS), the country’s central bank. The MAS wants to make Singapore a so-called hub for financial innovation, including crypto, but warns individuals against investing.
Crypto lacks use case and regulation
According to Farooq, the use case of cryptocurrencies such as bitcoin (BTC) and ethereum (ETH) has not yet emerged clearly. He also believes that the regulation and supervision of the market is still far behind. This means that institutions from the traditional financial world are still very reluctant and only gradually enter this market.
For the vast majority of crypto, according to the top banker, there is no use case at all. He says that most of the money flowing into the market is not for building the infrastructure, but mainly for speculation. He expects that most crypto coins will eventually disappear from the market:
“Most cryptos are actually still junk. I mean, with the exception of a few dozen tokens, everything else that’s been mentioned is either noise or frankly, is just going to disappear. So in my opinion the use cases haven’t fully emerged yet, and the regulations are behind and I think that’s why you see the financial industry in general being a little slow to catch up. At the moment we are just not there yet, most of the money used in Web3 today, in the current infrastructure, is for speculative investments.”