Bitcoin Becomes Safe Collateral: JPMorgan To Offer Loans Financed With Crypto Assets

Less than 8 years ago, when bitcoin was trading at $4,000 (compared to $104,000 today), Jamie Dimon demonstrated once again that he may be an ok big bank CEO (after all, without TARP JPMorgan would not exist today), but he is a terrible visionary when he warned his traders that anyone caught trading bitcoin”would be fired.”

Fast forward to today, then, when not only will Jamie (who at almost 70 should really be thinking succession) not fire anyone at JPM for trading the best performing asset of the millennium, if not all time, but according to Bloomberg JPM will soon allow trading and wealth-management clients use some cryptocurrency-linked assets as collateral for loans, a major step by the biggest US bank to make inroads into an industry President Donald Trump has pledged to support.

According to the report, the firm will start providing financing against crypto exchange-traded funds, beginning with BlackRock’s iShares Bitcoin Trust (IBIT), in the coming weeks, people familiar with the matter said. The move marks the latest effort involving crypto among the biggest US banks after the Trump administration started removing regulatory barriers.

Just as importantly, JPMorgan – which until now refused to add crypto to the calculation of net worth – will also begin taking wealth-management clients’ crypto holdings into account when assessing their overall net worth and liquid assets, the people said, asking not to be named as the plans aren’t public. That means cryptocurrencies will be given similar treatment to stocks, cars or art when calculating how much a client can borrow against their assets.

Which, incidentally, is precisely what we predicted last November when we said

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