JPMorgan CEO Jamie Dimon has been publicly dismissive of bitcoin, calling it a “fraud” that will not survive.
“It’s just not a real thing, eventually it will be closed,” Dimon said at the Delivering Alpha conference in September presented by CNBC and Institutional Investor. “It won’t end well. Someone is going to get killed.”
But Bart Stephens, co-founder and managing partner of San Francisco-based venture capital firm Blockchain Capital, recently slammed Dimon’s remarks as hypocritical and ignorant.
“While Jamie Dimon was making those comments, I was an invited speaker at JP Morgan’s offices in San Francisco to give a talk with other fund managers and clients of JP Morgan who are really curious about cryptocurrencies and the underlying blockchain technology,” says Stephens, speaking with Fortune’s Term Sheet newsletter.
“So there’s a lot of hypocrisy going on with Jamie Dimon,” he says. JPMorgan declined to comment.
Also, Stephens says that Dimon’s comments discounting the significance of bitcoin were reflective of his lack of understanding of the technology’s potential.
“The blockchain and cryptocurrencies have elicited an emotional response from financial incumbents. The technology is controversial and misunderstood, but that doesn’t make it any less real,” he says to Term Sheet.
“I would encourage Jamie Dimon and others to do some homework first. It is not a fraud. It is not a Ponzi scheme. It’s a robust technology that is going to impact multiple industries,” Stephens says. “Don’t discount it.”
Stephens says the wave is coming. “For too long, Silicon Valley has ignored the tsunami,” he says. “Many of my friends who are at generalist VC firms dismiss this stuff out of hand because they’re not spending the time to do the homework.”
Of course, it is in Stephens’ interest to publicly promote the potential of bitcoin technology. He is an investor in it. Blockchain Capital has a whole portfolio of blockchain-enabled companies, including Coinbase, Ripple and Abra.
However Stephens is not alone in publicly taking issue with Dimon’s dismissiveness about the technology. One cryptocurrency start-up used Dimon’s comments as fodder for a full-page ad in The Wall Street Journal. “Maybe Jamie will fire you. But, you’ll be free to trade in the crypto-world,” the ad says. Dimon said he would “fire in a second” any JPMorgan trader who was trading bitcoin: “It’s against our rules and they are stupid.”
Not all legacy bank leaders write off bitcoin, notes Stephens.
“[F]or every negative Jamie Dimon, I could point you to two positive Wall Street CEOs like Lloyd Blankfein at Goldman Sachs and Abigail Johnson at Fidelity, who are making constructive comments on both cryptocurrency and the blockchain.”
And Stephens says it is his responsibility as an investor in new technology to stay level-headed through the volatility.
“Every new technology that is confusing, fast-moving and disruptive is going to be controversial. You’ll see people have emotional reactions. That’s part of why Blockchain Capital exists. We know this industry requires specialization,” Stephens says.
This story has been updated to correct information about Blockchain Capital’s portfolio.
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