Jamie Dimon Says Crypto Tokens Are ‘Decentralized Ponzi Schemes’

Jamie Dimon didn’t mince words when a US lawmaker mentioned the executive’s history of criticizing cryptocurrencies.

By:BLOOMBERG
| Updated on: Sep 23 2022, 00:10 IST
This malicious Firefox add-on stole thousands of dollars in cryptocurrency
Cryptocurrency
1/6 A particular malicious add-on for Firefox, that goes by the name Safepal Wallet, has managed to scam users by stealing money from them and managed to live on the Mozilla add-ons store for seven months before getting detected and removed. (Pixabay)
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2/6 Safepal is essentially a cryptocurrency wallet application that is capable of holding more than 10,000 types of assets, including Ethereum, Bitcoin, Litecoin, etc. However, Safepal is an official smartphone app that is available for Apple and Android both. There are no known “authentic” Safepal browser extensions. (BleepingComputer)
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3/6 According to a post shared by a user who goes by the name Cali on the Mozilla Support forum, within a few hours of installing and logging in to the Safepal Wallet extension with their real Safepal credentials, they saw their wallet balance drop to $0 from $4,000.  (Mozilla Support Forum )
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4/6 While investigating Safepal Wallet, BleepingComputer came across the phishing domain used by the add-on and this webpage was also listed as the "support site" link on the fake add-on's home page: https://safeuslife.com/tool/. WHOIS records indicate the this phishing site was registered in January this year via Namecheap. And BleepingComputer reported that at the time of them filing this report, the webpage is still live and it instructs people to key in their "12-word Backup Phrase in the correct order to pair your SafePal Wallet". (BleepingComputer )
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5/6 Once the recovery phrase is entered and the form is submitted, the page refreshes without any noticeable response and the recovery phrase is sent to the attacker. A stolen recovery phrase can give attackers control over your wallet along with the ability to access and transfer funds. (Pixabay)
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6/6 Five days after Cali publicly reported the incident, a Mozilla spokesperson responded to say that they were investigating the issue and the page for Safepal Wallet has since been removed by Mozilla. The Mozilla add-ons store now has one-star reviews posted by some users that are warning others to not download “Safepal Wallet”. (BleepingComputer )
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JP Morgan Chase & Co. chief executive officer Jamie Dimon called cryptocurrency “decentralized Ponzi schemes”. (REUTERS)

Jamie Dimon didn't mince words when a US lawmaker mentioned the executive's history of criticizing cryptocurrencies.

“I'm a major skeptic on crypto tokens, which you call currency, like Bitcoin,” the JPMorgan Chase & Co. chief executive officer said in congressional testimony Wednesday. “They are decentralized Ponzi schemes.”

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Stablecoins -- digital assets tied to the value of the US dollar or other currencies -- wouldn't be problematic with the proper regulation, and JPMorgan is active in blockchain, Dimon said.

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The comments represent the latest criticism leveled against digital currencies by Dimon, who once called Bitcoin “a fraud” before eventually saying he regretted the comments.

House Financial Services Committee Chairwoman Maxine Waters and Ranking Member Patrick McHenry have been working to reach an agreement on stablecoin legislation. Under the latest version of the bill, it would be illegal to issue or create new “endogenously collateralized stablecoins” such as those similar to TerraUSD, the algorithmic stablecoin that collapsed earlier this year, according to a copy obtained by Bloomberg.

While Dimon has been a vocal critic of Bitcoin, the firm has been focused on using blockchain for financial services. JPMorgan uses its custom blockchain and token, JPM Coin, to conduct intraday repurchase agreements, which allows other financial institutions to take out short-term loans using high-quality collateral. JPMorgan was also the first Wall Street bank to launch a presence in the metaverse in February.

Dimon deemed Bitcoin a fraud in 2017, comments he later said he regretted. In October, he said it was worthless but that he'd follow clients and recently acknowledged that decentralized finance -- where banks are replaced by algorithms -- is “real.”

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First Published Date: 23 Sep, 00:10 IST
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