Nobody uses crypto to pay for things anymore, says JPMorgan’s payments boss

JPMorgan Chase’s global head of payments, Takis Georgakopoulos, says cryptocurrency has “a niche use case” and said demand for cryptocurrencies as a payment method has seen a drastic decline in the past. course of the last six months.

Georgakopoulos, speaking in an interview with Bloomberg Television on Tuesday, said that while the bank is still accepting customers who want to use cryptocurrencies as a method of payment, it is no longer taking primary risk as the coins are losing popularity.

“When it comes to crypto as a payment method, we say there is a lot of demand for our customers, say until six months ago. We are seeing very little right now,” Georgakopoulos concluded.

Focus on the sector again

JPMorgan was one of the first banks to jump into the cryptocurrency space, and despite its recent decline in popularity and price, the bank is still betting big on the tokenized asset sector. While reversing the recent popularity of crypto, Georgakopoulos took the opportunity to tout the many benefits of digital currencies.

“Blockchain technology has absolutely a great advantage: the fact that people can exchange information without a centralized exchange, [and] in terms of security, privacy, etc. said Georgakopoulos. JPMorgan also sees the gaming space as another area of ​​growth, where “the intersection between real, virtual, and crypto” in traditional gaming and the metaverse is widening.

But with a recent crypto price crash showing few signs of ending, it’s unclear when crypto’s popularity will return. Cryptocurrencies have seen the biggest decline in the market this year and have lost over $2 trillion in market value in less than a year. Leading digital asset companies like Terraform Labs and Three Arrow Capital have been pushed out of business and cryptocurrency king Bitcoin, which was priced above $65,000 in November 2021, is now below $20,000.

What about other alternative payment methods?

Asked about other digital tokens like central bank digital currencies (CBDCs), Georgakopoulos was weary of making predictions as little is known about how countries’ digital currencies work.

“We haven’t seen them yet and the rules for how they will run haven’t been written, with the possible exception of China,” Georgakopoulos said, referring to China’s digital yuan which has been in testing since 2020 and one of the most advanced. major economy, but is the subject of intense scrutiny and criticism abroad regarding a possible follow-up.

Georgakopoulos says JPMorgan believes blockchain and digital currencies used as alternative payment options have some inherent advantages, but also face major hurdles.

“The most exciting thing about a digital currency on a blockchain is the ability to move information and value at the same time, in real time, without any of the constraints of traditional payment systems,” notes Georgakopoulos, c That’s why JPMorgan is investing in its own blockchain network that can accept fiat currencies as well as digital currencies or central bank digital currencies as they evolve in the future.

JPMorgan also backed London-based digital asset startup Ownera last week through a $20 million Series A funding round. He argues that in areas such as the Internet of Things, smart devices and mobility, new digital payments may be needed in the future, but for now the world is still a long way off.

“I think we still have… a bit of a way to go on that front,” he says.

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