Betting on bitcoin and other virtual currencies is risky, legally uncertain, but potentially very profitable. Faced with this dilemma, Wall Street veterans swing between enthusiasm and skepticism.
JPMorgan Chase, the president of the largest bank in the United States, has a definite view on the matter.
“If you ask for my advice, I’d say don’t get close,” Jamie Dimon said at a parliamentary hearing in late May.
But “it’s not my role to tell people how to spend their money,” he said. Your bank is currently looking at how to help its customers enter the crypto space.
Inspired by some small investors with time and money during the pandemic, virtual currencies surged in 2020 and early 2021.
Banks, brokerages and investment firms are now trying to satisfy some clients who feel they have missed an opportunity.
Traditional financial services manager State Street announced last Thursday (10) the creation of a division dedicated to digital assets.
Last Wednesday (9), the president of online brokerage Interactive Brokers said that his clients would be able to exchange cryptocurrencies on his website by the end of the summer.
Like its rivals Charles Schwab and Fidelity, Interactive does not currently allow the purchase of virtual currencies such as bitcoin and ethereum, but does offer financial products tied to these values that prevent investors from holding them directly to their wallets.
Robinhood brokerage and Coinbase platforms allow you to buy them.
The company ForUsAll, which manages retirement funds for nearly 70,000 employees, today struck a deal with Coinbase to allow its customers to add 5% of cryptocurrency to their funds.
Business bank Morgan Stanley said in March that it would allow its wealthiest customers to invest in bitcoin funds. And Goldman Sachs recently launched a team dedicated to cryptocurrency brokerages.
Fidelity Investments, one of the world’s largest asset managers, has been offering brokerage and deposit services for these assets reserved for large investors such as “hedge funds” since 2018, and launching new products involving bitcoin. Getting ready.
This type of product can facilitate individuals to invest in cryptocurrencies.
Despite a progressive opening, this type of asset is still risky.
The rules are not clear and theft by hackers is frequent. In addition, its volatility is very high: bitcoin went from about 30,000 US dollars (about R $ 158.1 thousand) at the beginning of the year to US $ 63,000 (R $ 354.2 thousand) in mid-April, and it was $ 34 thousand ( R $ 172.2 thousand) in early June.
“Speculators and those who fear missing out on a good opportunity will continue to turn to cryptocurrencies hoping to make a lot of money,” said Ian Gendler, Value Line Consultant.
This expert discourages its clients from investing in cryptocurrencies because of the high risk and the impossibility of predicting their value: unlike a company or raw material, cryptocurrencies are not backed by any tangible asset and, unlike currencies, They are not guaranteed. Government.
“Cryptocurrencies” are ready to pay the next investor, Gendler said.
For Chris Kuiper of consultancy CFRA, these emerging properties are here to stay. He estimates its use will increase “as the legal and regulatory framework builds up”.