JPMorgan CEO's Senate Testimony About Crypto: "I’d Close it Down"

JPMorgan’s Jamie Dimon Bashes Crypto: ‘I’d Shut It Down’

JPMorgan Chase CEO Jamie Dimon has never been shy about trashing crypto, even while his giant Wall Street bank became a leader in using blockchain technology to move billions. At a U.S. Senate hearing Wednesday, he slammed the industry again, to the delight of Sen. Elizabeth Warren (D-Mass.), who is trying to impose restrictions to combat illicit digital transactions.

“I’ve always been deeply opposed to bitcoin, crypto, etc.,” he told senators in a hearing examining the U.S. banking industry. “If I was the government, I’d close it down,” he declared.

Lined up with other big-bank CEOs before the Senate Banking Committee, Dimon argued that the crypto industry gets to “move money instantaneously” without going through the regulatory conduits required by bankers, including sanctions and money-laundering controls. He contended that the primary use case for digital assets is criminality.

US bitcoin ETF issuer talks with SEC have advanced to key details -sources

Discussions between the U.S. securities regulator and asset managers hoping to list bitcoin exchange-traded funds (ETFs) have advanced to key technical details, in a sign the agency may soon approve the products, industry executives said.

Thirteen firms including Grayscale Investments, BlackRock (BLK.N), Invesco, and ARK Investments, have pending applications with the Securities and Exchange Commission (SEC) for ETFs that track the price of bitcoin.

Binance is law-abiding now

Crypto is mature enough by now that there are some good running bits, some callbacks to old jokes. Tether has spent years telling anyone who will listen that it is just months away from releasing an audit, and everyone has a good laugh each time. And Binance has spent years claiming that it was located nowhere, to the point that when Chinese police reportedly raided its Shanghai office, Binance replied that it “has no fixed offices in Shanghai or China, so it makes no sense that police raided on any offices and shut them down.” Classic.

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… I guess it’s fine for a financial institution trusted with billions of dollars of customer money not to be located in any particular jurisdiction? Binance’s plea agreement requires it to hire a monitor to write reports on its anti-money-laundering compliance and share them with the US Department of Justice, and requires Binance to “provide the Monitor with access to all … facilities, and employees, as reasonably requested by the Monitor, that fall within the scope of the Mandate of the Monitor,” so I suppose the Justice Department can find out where Binance is located, but maybe not? Maybe the monitor will be like “hey can I visit headquarters” and Binance will say “why do you feel entitled to that”?

Audit Board Opens Probe Into Culture at Six Top US Firms

The culture at six of the largest US audit firms is under scrutiny as their regulator aims to understand how firm leadership and internal policies might hinder their work vetting corporate revenue and balance sheets.

The review will be part of the six firms’ routine inspections and will extend through 2024, Christine Gunia, acting inspections director at the Public Company Accounting Oversight Board, said Wednesday. The firms facing heightened attention from the board are Deloitte LLP, Ernst & Young LLP, KPMG LLP, and PwC LLP, plus BDO USA P.C. and Grant Thornton LLP.

SEC Chair Warns Against “AI Washing”

All of which is a long way of saying, as Gensler’s comments underscored, that along with the many changes that AI is bringing to industry and financial markets, AI is also brining a host of potential litigation risks and exposures.

Gensler’s point – that though AI is a new technology, the same disclosure principles still apply – is an important one. While there may be a sense in the current climate that we have to be talking about AI because it is the hot topic du jour does not take away from the fact that there are some real and identifiable litigation risks associated with corporate adoption of AI tools. I suspect we will not have to wait long to see AI-related corporate and securities lawsuits.