JPMorgan CEO Jamie Dimon is facing scrutiny from the crypto community after being designated as an authorized participant (AP) by BlackRock in its proposed Bitcoin ETF application. This move has drawn criticism due to Dimon's previous negative remarks about cryptocurrencies, where he advocated for shutting them down and characterized Bitcoin as primarily serving criminal activities during a Senate Banking Committee hearing. The irony of JPMorgan's role as an AP in a Bitcoin-related venture has prompted accusations of inconsistency and has prompted questions about the bank's stance on digital assets.
Crypto enthusiasts on social media have pointed out the apparent paradox, questioning how JPMorgan can participate in a Bitcoin ETF while its CEO publicly condemned cryptocurrencies for their alleged ties to illegal activities. XRP lawyer John Deaton expressed scepticism about JPMorgan's involvement, suggesting it might be an effort to mislead the public or engage in gaslighting. Despite JPMorgan's previous staunch opposition to the digital asset sector, the bank recently introduced its crypto token, JPM Coin, and participated in blockchain initiatives, leading to further debate about the bank's evolving relationship with the crypto space.
Indonesian police have taken decisive action by shutting down ten Bitcoin mining operations, alleging the organizers engaged in electricity theft totalling nearly $1 million. The North Sumatra Police Force conducted the operation across multiple sites, seizing 1,134 Bitcoin mining machines, 11 meters of electrical cable, and various computer equipment. Chief of North Sumatra Police, Irjen Agung Setya Imam Effendi, claimed that the organizers manipulated electrical circuits to power the extensive array of Bitcoin mining machines. The improper diversion of electricity, estimated to cause a loss of approximately $935,666, was identified in 10 locations.
This move by Indonesian authorities follows a similar crackdown in China, where a former government official, Yi Xiao, received a life sentence for enabling electricity access to Bitcoin miners. Xiao, previously vice chairman of the Jiangxi Provincial Political Consultative Conference Party Group, operated a significant Bitcoin mining enterprise from 2017 to 2021. With over 160,000 Bitcoin miners and accounting for 10% of Fuzhou city's electricity consumption at one point, the case underscores the global scrutiny of Bitcoin mining practices and their impact on local power infrastructure.
Several companies, including Invesco Galaxy, Bitwise, WisdomTree, and Fidelity, are racing to get approval for a Bitcoin exchange-traded fund (ETF), with their final applications submitted on December 29. These applications were sent to the U.S. Securities and Exchange Commission (SEC). Notably, Invesco Galaxy, Bitwise, WisdomTree, and Fidelity followed the footsteps of BlackRock, Van Eck, and Valkyrie, who had already submitted their applications. Fidelity, WisdomTree, and Invesco Galaxy have disclosed their chosen authorized participants in the filings, with Invesco Galaxy opting for Virtu and JPMorgan, while WisdomTree and Fidelity selected Jane Street Capital. There's also a bit of price competition, with Invesco Galaxy offering a fee waiver for the first six months and the first $5 billion in assets, and Fidelity setting its fee at 0.39%.
It's noteworthy that WisdomTree has decided to stick with in-kind share creation and redemption despite the SEC's recommendation to switch to cash. This development indicates the growing interest and competition among financial institutions to launch a Bitcoin ETF, with each trying to stand out in terms of fees and strategies.