With the rise of digital coins, JPMorgan Chase has labeled cryptocurrencies as a threat to its business in its annual 10-K filing. The bank’s comments mirror those by Bank of America (BoA) and Goldman Sachs, Coindesk reported.
JPMorgan Chase listed cryptocurrency’s impact on payment processing in its “risk factors” section. As a result, the bank might have to introduce new products or modify existing offerings.
“Both financial institutions and their non-banking competitors face the risk that payment processing and other services could be disrupted by technologies, such as cryptocurrencies, that require no intermediation,” the bank wrote in the filing. “New technologies have required and could require JPMorgan Chase to spend more to modify or adapt its products to attract and retain clients and customers or to match products and services offered by its competitors, including technology companies.”
The news comes after Bank of America reported that cryptocurrency could represent a substantial threat to its business in its annual filing with the SEC. The second largest bank in the United States by assets, BoA issued a warning that was the first of its kind for the institution — it has never in the past warned investors about technology’s potential as a risk factor.
However, on balance, BoA only made about three references to digital currency forms in the 13,000-word filing, and crypto was far from the only threat listed. Brexit and cybercrime also made the list, and were mentioned more often.
But the mere mention, according to Financial Times reports, indicates that BoA is taking crypto seriously, beyond just a fad or fuel for a massive investing bubble. The filing also noted that crypto, among other possible advances, could prove to be a costly competitor for the bank if it manages to find an audience among mainstream consumers.
“The widespread adoption of new technologies, including internet services, cryptocurrencies and payment systems, could require substantial expenditures to modify or adapt our existing products and services,” it said.