Bitcoins are the playthings of computer programmers with very little money.
About 90% of America’s wealth is held by about 20% of the population. These people do not use Bitcoins. They never will. Why should they? If they should ever want what Bitcoins offer — and Bitcoins do not offer much, so far — they will use JP Morgan Chase Bank, which is now going to provide the same service.
Why use poor people’s crypto-currency, when you can use rich people’s crypto-currency? Why limit your transactions to a handful of struggling retail firms that sell things to poor people, when you can deal with established firms to sell things to rich people?
Why limit your universe of users to kids who live on pizza and Jolt Cola, when you can can expand your universe to people with serious money?
If there is anything to crypto-currency, Bank of America will get into this market. Then Citigroup will.
Bitcoins? Why bother? Go where the big money is, not where the big money will never be.
Think of Bitcoins as a bicycle with training wheels. Think of JP Morgan Chase’s program as a Harley.
This is from the Zero Hedge site.
If you can’t beat ’em, join ’em, copy ’em, and then beat ’em. While everyone’s attention has been glued to Bitcoin (and its various smaller and less viable for now alternative digital currencies), JPMorgan has submitted a patent which appears to set the scene for a competing centralized network to Bitcoin. As LetsTalkBitcoin noted first, the “Method and system for processing internet payments using the electronic funds transfer network,” states that Chase’s technology is a “new paradigm.” Moreover that it permits the creation of “virtual cash” (also referred to as “web cash”) with a “real-time digital exchange of value.”
Imagine paying for some product in a transaction directly with the seller that doesn’t include a costly third-party fee or the revelation of a personal account number — the current components that comprise credit card and debit card purchases. Imagine this system with a “real-time digital exchange of value.” And imagine that you can archive all the transactions in a personal digital wallet, with its own “Internet Pay Anyone (IPA)” account and inherent safeguards built-in, something that you could call “Virtual Private Lockbox (VPL),” according to JPMorgan’s patent.
If this “web cash” system — as JPMorgan Chase calls it — seems familiar, it should. It smacks of the peer-to-peer transactions of Bitcoins and other cryptocurrencies that increasingly are making the world’s biggest banks uneasy about the future of e-commerce.
The patent, first revealed by LetsTalkBitcoin.com, is a fascinating look into JPMorgan’s veiled outlook on the evolving but growing bitcoin universe, and other more widely-accepted payment systems.
JPMorgan’s proposed system offers another eerily familiar component, which seemingly mimics “blockchain,” a publicly available, permanent ledger of bitcoin transactions.
Without naming the virtual currency or any competing payments system by name, the bank takes a swipe at the cryptocurrency model.
“None of the emerging efforts to date have gotten more than a toehold in the market place and momentum continues to build in favor of credit cards,” according to Chase’s patent application published by The United States Patent and Trademark Office (USPTO). It was filed August 5th, 2013.
(For the rest of the story, click the link.)