The Intersection: Crypto and Wall Street This Week

As bitcoin, ethereum and other cryptocurrencies get increasing attention from investors, Wall Street and its traditional banks continue to adjust to the shift. Catch up on this week's top stories highlighting the intersection of these old guard and new school areas of finance with this recap compiled by The Fly: 1. DIMON DOUBLES DOWN: Following comments by JPMorgan (JPM) CEO Jamie Dimon that bitcoin is a "fraud", JPMorgan Securities bought large amounts of Bitcoin XBT through Swedish Bitcoin exchanges on behalf of clients when the price dropped, according to a report. Dimon's remarks drew criticism from bitcoin experts, bankers and former JPMorgan executives, including former head of global macro Alex Gurevich. In a tweet, Gurevich said, "Jamie, you're a great boss and the GOAT bank CEO. You're not a trader or a tech entrepreneur. Please, STFU about trading $BTC." However, in an interview with CNBC India, Dimon doubled down on his comments saying cryptocurrencies "are kind of a novelty" and said governments would impede the growth of digital coins as currency requires government backing. "It's creating something out of nothing that to me is worth nothing," he said. "It'll end when people lose a lot of money." 2. DALIO CAUTIOUS TOO: In addition, Ray Dalio, founder of Bridgewater Associates, had similar views in an interview with CNBC on September 19, saying "bitcoin is a bubble". "It's not an effective storehold of wealth because it has volatility to it, unlike gold," he said. "Bitcoin is a highly speculative market." 3. SWITZERLAND SHUTTERS 'FAKE' E-COIN: Switzerland's financial watchdog FINMA shuttered the QUID PRO QUO Association, a provider of fraudulent cryptocurrency called E-Coins, which had secured funds of approximately 4M Swiss francs, or $4.2M, from several hundred users. The regulator, which is currently conducting investigations into roughly a dozen other potential fake virtual currencies, said E-Coin was not real as it was not stored on distributed networks using blockchain technology, instead being kept locally on the association's servers. 4. CHINA CONTINUES CRACKDOWN: Chinese authorities reportedly have decided on a comprehensive ban of channels trading in bitcoin, following a September 15 meeting in Beijing, going beyond plans to close commercial exchanges. The move comes as a surprise to industry executives, who thought authorities might shutter only commercial trading activity while allowing peer-to-peer bitcoin platforms. Amid China's cryptocurrency crackdown, bitcoin traders and blockchain-technology experts gathered for a two-day conference in Hong Kong, originally scheduled to be in Beijing, as conference organizer Bitkan wanted "to lower the risks of [the event] being canceled." John McAfee, founder of the McAfee antivirus, said "We are fugitives here," but added, "The creators designers and innovators will find a way around it. They always do and always will." 5. NVIDIA TO GAIN FROM CHINA BAN: In a September 15 research note, RBC Capital analyst Mitch Steves said he believes that Nvidia (NVDA) will be boosted by China's ban on cryptocurrency, since it is still legal there "to mine them with computing power," the analyst stated. He thinks that individuals in China who want to obtain cryptocurrency will purchase more crypto-related graphics processing units, benefiting Nvidia. The analyst believes that "decentralized exchanges" will be created for crypto trading in China. He keeps an Outperform rating on Nvidia. In prior research, Jefferies' analyst Mark Lipacis told investors that he estimates cryptocurrency revenues accounted for about 3% of quarterly sales for Advanced Micro Devices (AMD) and about 10% for Nvidia in the second quarter. PRICE ACTION: As of time of writing, Bitcoin is down about 1.9% this week, or $72, to $3,575 in U.S. dollars. Meanwhile, AMD shares rose 6% to $13.26 this week and Nvidia dropped 0.6% on a weekly basis to $179.24. Additionally, Bitcoin Investment Trust (GBTC) fell roughly 10% this week to $638.47. WANT BITCOIN NEWS ALERTS?: To receive alerts on stories relating to bitcoin and other cryptocurrencies, Fly subscribers can enter "Bitcoin" into the "Add symbols" box of their portfolios.