The Financial Times reports that JPMorgan, the largest World Bank, plans to offer brands supported by Crypto, which means that its customers could soon be able to promise bitcoin, ether or another token to borrow dollars.
The news is remarkable for two reasons. Crypto loves to emphasize that Jamie Dimon, the director general of the bank, said in 2017 that he dismissed any employee caught in negotiating Bitcoin to be “stupid”, therefore JPMorgan, considering the issuance of such a product (and getting involved with stablescoins) is considered a justification by some in the industry.
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More interesting is what the JPMorgan movement could end up with a meaning for cryptographic loans. The Bank of Dimon is not the first tradfi company to examine the loans supported by Crypto (Cantor Fitzgerald announced a similar program last July), but it is certainly the most important.
At the end of 2024, the cryptographic loan market amounted to $ 36.5 billion, down 43% compared to its peak of $ 64.4 billion up to 2021 Bull Run. The loan sector was dominated by Tether, followed by Galaxy Digital and LEDN. Together, the three companies represented 90% of the $ 11.2 billion in circulation loans (with the exception of DEFI, which saw $ 19.1 billion in 20 requests and 12 blockchains).
I am sure that these figures must be updated, given the number of Indigenous Crypto companies that have announced their entry into the market since then – Coinbase, Strike, Xapo Bank, Lava, Onramp and Arch, and even the Propy focused on the essentials, to name a few.
The growth of the sector is excellent for consumers, because it will require interest rates on the loans supported by the crypto to lower considerably, said Mauricio Di Bartolomeo, co-founder of Bitcoin Lender LEDN, told Coindesk in an interview in April.
“It’s a seller’s market right now,” he said. “We lend dollars entirely guaranteed to north 12.5%, without losses of seven years. A bank will arrive with 12% interest.
Below, these loans could become competitive with equity or personal credit lines, said Di Bartolomeo. Even better, rates would not just drop in Western countries with effective banking systems, but all over the world.
“Gold in a safe in Switzerland is not gold in a safe in Venezuela, but bitcoin in Colombia is Bitcoin in Madrid is bitcoin all over the world. As an subscriber, I have uniform guarantees,” said Di Bartolomeo.
The JPMorgan foray into the sector brings us a step closer to the realization of this vision.
