The head of JPMorgan’s digital assets unit, Umar Farooq, said that most of the crypto assets on the market are “junk” and that there aren’t many real-world uses for crypto yet.
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During a panel discussion at the Monetary Authority of Singapore’s Green Shoots Seminar on August 29, Farooq argued that regulation has not yet caught up with the booming industry, preventing many conventional financial institutions (TradFi) from participating.
He also noticed that, with a few exceptions, most crypto assets don’t do anything useful:
“The majority of crypto assets are still worthless, with the exception of a few dozen tokens. Everything else that has been stated is either noise or, honestly, will just disappear. ”
So, from my perspective, the use cases haven’t completely emerged, and the regulation hasn’t caught up,” said Farooq, CEO of JPMorgan’s blockchain business, Onyx Digital Assets. “I believe that’s why you see the financial industry in general being a little bit reluctant to follow up” (ODA).
The JPMorgan executive also said that the industry is not mature enough to host products like tokenized deposits or to do “real transactions” between TradFi institutions (an existing bank deposit held as a liability against depository institutions).
Farooq stated that crypto, blockchain, and the larger Web3 movement currently serve primarily as a platform for speculative speculation.
“You must wait for all of these things to grow before you can use them. Right now, we’re just not there; the majority of Web3’s present infrastructure funding is devoted to speculative investments.
While JPMorgan has been more crypto-friendly in recent years, the banking behemoth is largely focusing on blockchain technology and how it can be used to improve TradFi services.
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Asian Trade revealed in May that JPMorgan has experimented with tokenized collateral settlements using its own private blockchain. During the test, two of its businesses were able to move a tokenized version of Black Rock Inc. money market fund shares.
