JPMorgan Chase is weighing whether to help clients bet on the price of bitcoin via the CME Group’s proposed futures contracts, according to a person with knowledge of the situation.

The largest U.S. bank is gauging client demand and the potential risks of facilitating their trades, the person said, asking not to be identified talking about internal deliberations. Chicago-based CME Group has said it hopes to offer bitcoin futures by the end of the year.

Jamie Dimon, chief executive officer of JPMorgan Chase, looks on during the Europlace forum in Paris.
Mixed message?
JPMorgan CEO Jamie Dimon has been one of bitcoin’s most prominent detractors, calling it a fraud and deriding buyers as “stupid,” but his finance chief, Marianne Lake, has struck a more measured tone. Bloomberg News

Bitcoin’s eightfold surge in value this year is forcing Wall Street banks to balance clients’ interest in speculating on the cryptocurrency with executives’ skepticism about its future. JPMorgan Chief Executive Jamie Dimon has been one of bitcoin’s most prominent detractors, calling it a fraud and deriding buyers as “stupid,” but his finance chief, Marianne Lake, has struck a more measured tone. The firm is “open-minded” to the potential uses for digital currencies so long as they are properly regulated, she said last month.

JPMorgan already allows clients some access to bitcoin through an exchange-traded note, which involves routing their orders to exchanges. Handling client trades of futures contracts is conceptually similar but could still pose some risks, according to the person.

The New York-based bank’s deliberations were reported earlier by The Wall Street Journal. The exchange operator Cboe Global Markets is competing with CME Group to introduce bitcoin futures.

Bloomberg News