Morgan Stanley CEO Says Bitcoin Could Have Legs

When it comes to Bitcoin and other digital currencies, Morgan Stanley chief executive officer James Gorman sees potential, something with which his counterpart at JPMorgan does not agree.

Speaking during a Wall Street Journal event on Wednesday (Sept. 27), Gorman said cryptocurrencies are “certainly something more than just a fad,” reported CNBC. What’s more, the executive didn’t call for additional regulations of the new marketplace, but rather said technology trends will force the regulators to change.

“None of us operate in isolation in the ecosystem in which we live,” Gorman said. “If banks behave badly, the government says, ‘Raise more capital.’ We say, ‘Gee, that makes us less profitable,’ and they say, ‘That is now your problem.’”

According to the CNBC report, the executive went on to say that the government cannot say it will forbid people to transfer more money, which cryptocurrencies make possible.

“So, there is a sort of government risk factor to it,” Gorman said at the event, CNBC reported.

The comments come as the price for Bitcoin surpassed $4,000 in trading, with its value now up for the fourth time in 2017. The value is still $900 below its all-time high hit earlier in September, before the Chinese government started cracking down on Bitcoin exchanges and initial coin offerings (ICOs).

Earlier in September, JPMorgan Chase chief executive officer James Dimon called Bitcoin a fraud and predicted the cryptocurrency would implode.

“The currency isn’t going to work,” Dimon said, according to Reuters. “You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart.”

Dimon also said any JPMorgan traders working with the cryptocurrency would be fired on the spot for two reasons: It’s against the company’s rules, first of all, and secondly, Dimon feels it is “stupid.”  His comments came at a time when the price of Bitcoin had quadrupled since December and at one point flirted with a new high of $5,000.

“Don’t ask me to short it,” Dimon said, according to Reuters. “It could be at $20,000 before this happens, but it will eventually blow up. Honestly, I am just shocked that anyone can’t see it for what it is.”