Cryptocurrency Isn’t “Just a Fad,” Says Head of Morgan Stanley

The Chief Executive Officer of one of the country’s largest banks told investors what he thought about cryptocurrencies this week, striking a more open-minded tone than other influential bankers have provided us with as of late.

James P. Gorman, Morgan Stanley’s CEO, spoke at the Wall Street Journal’s “Future of Finance” breakfast event on Wednesday – as he was interviewed by the publication’s Financial Editor, Dennis Berman. The conversation was billed as an exploration of how finance is being redefined by technology, and how government regulations are being reexamined as the industry evolves.

Naturally, the conversation ended up landing on the topic of bitcoin, after a member of the audience asked Gorman what he thought of virtual currencies. The CEO called cryptocurrency a “fascinating development,” saying that the idea of anonymous currency is a “very interesting concept” and definitely “more than just a fad.”

Gorman continued to talk about the federal regulation of both virtual, anonymous currencies and the traditional banking sector – which, either way, both end up under the government’s purview.

“If a currency is operating that is enabling people to transfer money anonymously, a government can say ‘We are not going to allow that anymore,” Gorman told the audience. “So there is a government risk factor to it.”

Responding to a moderator’s question about whether bitcoin should be illegal, the executive said that he doesn’t. Gorman made it known that he doesn’t personally invest in bitcoin, but that he’s spoken to plenty of people who have bought into the cryptocurrency market.

While the banking exec did say that the cryptocurrency market is clearly very speculative, he also said that it’s not intrinsically a bad thing.

“It’s a natural consequence of blockchain technology, as I understand it,” he added.

Gorman’s position on cryptocurrencies is a lot more easygoing than that of JP Morgan’s CEO, Jamie Dimon, who called bitcoin a “fraud” earlier this month – dismissing it as “just not a real thing” that would eventually be shut down. The exec, who was speaking during a banking conference in New York, added that he would instantly fire any trader that worked for him if he discovered they had been engaging in cryptocurrency activity.

Regardless of these executives’ divergent opinions on bitcoin, it’s hard to deny the growth that the cryptocurrency has enjoyed recently. Since July 1st, BTC/USD has gained an impressive 75 percent – even after taking a dip in mid-September.

Ref: CNBC | Image: Shutterstock
Author: Tim is a freelance writer and contributor to Live Bitcoin News, specializing in
cryptocurrencies, financial markets, personal finance and digital marketing. With a BA 
from UCLA and experience in equity capital markets research at a top New York financial 
data provider, Tim has written articles for a number of financial news sites.