Bitcoin has swung wildly over the last few months as a sudden BlackRock bitcoin fund sell-off accelerates, sparking fears of a bitcoin price crash.
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The bitcoin price has dropped by 40% since October last year even as “insane” money-printing predictions feed sky-high bitcoin price predictions.
Now, as Elon Musk reveals a $1.4 billion bitcoin price surprise, JPMorgan chief executive Jamie Dimon has issued a stark warning over president Donald Trump’s crypto market structure bill known as the Clarity Act.
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JPMorgan chief executive Jamie Dimon has predicted a stablecoin “blow up”—something that could crash the bitcoin price and crypto market.
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The Clarity Act, which was this month passed by the Senate banking committee, “allows [crypto companies] to effectively pay interest on deposits, stablecoins or something like that, without protection that they should have,” Dimon told Fox Business.
“The banks will not accept it that way … I’m not worried about stablecoins but if it happened I’m telling you I will have nothing to do with it and it will eventually blow up.”
The Clarity Act, which would carve up oversight of crypto between U.S. regulators and was predicted by Shark Tank star investor Kevin O’Leary to unleash a trillion-dollar influx of institutional capital into bitcoin and crypto markets, almost got over the line in January before it was torpedoed by crypto exchange Coinbase, with chief executive Brian Armstrong declaring it would have been worse than no bill in its form at the time.
The row between crypto companies and banks came down to whether those offering stablecoin accounts should be able to pay interest on deposits like traditional bank accounts, with banking groups warning that the stability of the financial system could be undermined as people move their money.
A compromise hammered out by lawmakers would see a ban imposed on interest-like rewards that are “economically or functionally equivalent” to deposit interest but allowing stablecoin balances to be used for rewards if companies clear the “equivalent” test.
“It will be fought,” Dimon said. “No one’s gonna bow down to [Armstrong], or [Coinbase] … He’s the only one and he’s spending hundreds of millions of dollars in Washington on this thing,” Dimon told Politico.
“The banks will not accept it that way,” Dimon added. “The ABA [American Bankers Association], the small banks, the credit unions. It’s not just the big guys.”
Earlier this month, Patrick Witt, the Trump White House’s executive director of the president’s council of advisors for digital assets, named July 4 as the administration’s target date to get the long-awaited Clarity Act over the line.
“We’re targeting July 4,” Witt said at the Consensus conference in Miami in comments reported by The Block. “I think that would be a tremendous birthday present for America, celebrating our 250th.”
The odds of the Clarity Act being passed this year have dropped back from almost 70% on the Polymarket prediction platform, falling to just over 50%.
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The bitcoin price has bounced back from its recent lows but remains well below its $126,000 per bitcoin price peak reached in October last year.
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Doubts surrounding the passage of the Clarity Act have weighed on the bitcoin price and crypto market in recent months.
“Growing expectations of a rotation of capital toward technology stocks, coupled with concerns that the Clarity Act may not pass this year, added further pressure and pushed bitcoin below the $76,000 per bitcoin level,” Yuya Hasegawa, crypto market analyst, said in emailed comments.