JPMorgan is the largest bank in the United States. The company has ruled America’s financial landscape for almost a decade now, cementing itself as a major player that looks to harness technological innovation as it grows.
In February, the company made history as the first major bank to get a branch in the metaverse.
Harnessing a $1 Trillion Market
Weeks back, JPMorgan unveiled its office in Decentraland - an Ethereum-based play-to-earn platform that many see as crypto’s best iteration of the metaverse. The bank’s lounge is located in Decentraland’s Metajuku Mall. Visitors are greeted by a giant picture of the bank’s chief executive, Jamie Dimon - along with an actual tiger roaming the hall.
Upstairs, visitors can watch different signs, including a presentation from a JPMorgan executive on the economics of cryptocurrency.
The JPMorgan lounge is named Onyx after the company’s blockchain-based payment system. The bank unveiled the lounge along with a comprehensive report explaining potentials for the metaverse and the many business opportunities that companies can engage in.
As JPMorgan said in its report, the metaverse has the potential to break into every industry on Earth. The banking giant believes the metaverse is a trillion-dollar opportunity, and companies need to move fast if they hope to get a piece. With outsized revenues on the way, JPMorgan hopes to beat its rivals in establishing a viable presence.
The report also highlights the over $54 billion being spent on virtual goods annually. The average price of a virtual piece of land jumped from $6,000 to $12,000 between June and December 2021. In-platform game advertising has become a $19 billion space.
Additionally, JPMorgan noted that individual creators are rushing to Web3 to monetize their work. A push towards non-fungible tokens (NFTs) and the metaverse are expected to play major parts.
“This democratic ownership economy coupled with the possibility of interoperability, could unlock immense economic opportunities, whereby digital goods and services are no longer captive to a singular gaming platform or brand,” said the report.
Dimon’s Rationality Strikes Again
JPMorgan’s move into the metaverse is yet another show of the bank’s speed to embrace innovation. It was the first major bank in the country to adopt blockchain technology into operations, and the first to have a payment-focused digital currency - the JPMCoin.
Interestingly, JPMorgan’s top brass isn’t exactly pro-crypto. Dimon himself has criticized Bitcoin more than once. He called it worthless last year, and said in February that he doesn’t use the term “cryptocurrency” anymore. As the billionaire CEO pointed out, currencies have laws behind them. Crypts don’t. They don’t deserve the “currency” tag.
Despite his contempt for digital assets, Dimon makes it clear that he understands the market and will steer JPMorgan in the right direction. If people want to accept crypto, there’s no reason for banks not to offer it - as long as they understand the risks.
A perfect example of JPMorgan’s relationship with crypto came in July 2021 when a Business Insider report confirmed the bank was allowing advisers to make crypto trades for clients. The report said retail wealth clients at JPMorgan could now access crypto funds, the bank offering exposure to names like Grayscale Bitcoin Trust, Bitcoin Cash Trust, Ethereum Trust, Ethereum Classic Trust, and the Osprey Bitcoin Trust.
But investors must request the service from their advisers, and advisers aren’t allowed to recommend crypto investments to clients.
Dimon told Times of India last year that he didn’t care about Bitcoin at all. But, that doesn't mean that its value can’t jump five times in the next five years. Though he would never purchase the asset, Dimon understands that Bitcoin has value to people, and he respects that.
This clear understanding is what separates Dimon from many other notable crypto detractors. While many critics simply slam crypto for numerous reasons, they fail to recognize and respect the growing public interest. Dimon has shown himself to be practical enough to observe the arena - and, in many ways, harness it.