The cryptocurrency market is the most disruptive technology the FinTech market has seen in all its years of existence. It poses a huge threat to the modus operandi of banks all over the globe and governments that run and fund them. And for the first time, banks and firms are opening up about the amount of change that is headed their way.
JP Morgan, a company that has gone on record and dismissed cryptocurrencies as a gimmick and a fraud, has finally accepted that the crypto market is a threat to their business in their annual report.
On Tuesday, JP Morgan released its annual report and in it, it speaks of just how big a threat the crypto market poses to their business model. “Both financial institutions and their non-banking competitors face the risk that payment processing and other services could be disrupted by technologies such cryptocurrencies, that require no intermediation,” JP Morgan stated in their recent report.
However, JP Morgan is not the first bank to acknowledge the very obvious risk the banking sector faces due to the crypto market. Just the other day, even the American Bank made a similar statement saying that they too run a very high risk of losing their client base to the new and emerging payment technologies.
Even the head of innovation of State Bank of India went on record to say that, “By 2030 all traditional banking services could cease to exist with blockchain. All services of banks can be replaced by blockchain.”
This is the first time the big players in the banking sector have made such open statements about the threats they face because of the cryptocurrency market. And on extension, it also means that their reasons for not allowing their customers to transfer funds in and out of exchanges, under the pretense of “protection”, due to anti-money laundering and anti-gambling laws were bogus and were just a way of tying their customers down to the services they provide and reinforcing their significance in the financial market.