JPMorgan adds crypto policy head after Dimon 'Ponzi scheme' quip

JPMorgan Chase has hired a new head of digital assets regulatory policy, less than a month after CEO Jamie Dimon told lawmakers that cryptocurrencies are "decentralized Ponzi schemes."

Aaron Iovine joined the company this week as executive director for digital assets regulatory policy, a newly created role, a JPMorgan spokeswoman confirmed. He was previously head of policy and regulatory for the cryptocurrency lender Celsius Network, whose bankruptcy filing has roiled the digital asset market.

Al Drago/Bloomberg

JPMorgan is looking to build out its policy ranks in the evolving digital asset space amid increased regulatory scrutiny and a downturn in cryptocurrency values.

Iovine didn't respond to a comment request.

Dimon and other JPMorgan executives have been vocal critics of digital assets.

Dimon's "Ponzi schemes" comment came Sept. 21 in congressional testimony, during which he called himself a "major skeptic on crypto tokens." Takis Georgakopoulos, global head of payments at JPMorgan, told Bloomberg Television last month that he sees "very little" demand for cryptocurrencies as a payment tool.

In addition to hiring Iovine, JPMorgan this month posted an opening for a digital assets counsel position with its corporate and investment bank.

Stacey Friedman, who has been JPMorgan's general counsel since 2015, didn't respond to a request for comment about the New York-based financial services giant's interest in lawyers familiar with distributed ledger technologies.

A JPMorgan spokeswoman declined to comment on Friedman and Iovine's behalf.

Iovine will work with JPMorgan's regulatory affairs group, which a year ago welcomed aboard former Davis Polk & Wardwell senior associate Sharon Yang as a managing director and global head of regulatory affairs. Yang previously served as a deputy assistant secretary for international financial markets at the Treasury Department.

Celsius hired Iovine earlier this year from Cross River Bank, a digital asset-friendly regional lender. The company recently brought on Benjamin Melnicki from Robinhood Markets to be its head of cryptocurrency compliance and regulatory.

Iovine, who like Melnicki is also an attorney, spent nearly three years at Cross River, where he led policy and regulatory affairs. Cross River hired Iovine in 2019 after he spent nearly a year as a senior regulatory analyst at the law firm White & Case.

During the first quarter of this year, Iovine was part of a Cross River team that lobbied Congress on "general issues focused on financial services, fintech partnerships, and the Paycheck Protection Program," according to a public filing.

Iovine departed Fort Lee, New Jersey-based Cross River in February to join Celsius, according to his LinkedIn profile. An online bio touts Iovine's expertise "exploring the future of financial services while working at the intersection of law, policy and regulation."

To keep flourishing, crypto needs a self-regulatory organization

He left Celsius in September, two months after the cryptocurrency rewards-earning and lending platform filed for bankruptcy in New York.

The Chapter 11 case has already generated large legal bills for Kirkland & Ellis — court filings show the latter has received at least $3.5 million in retainer payments — and other firms. It has also sparked fraud accusations against the London-based Celsius by a former company employee, whom the debtor has accused of deception.

A bankruptcy docket for the Celsius case shows that Iovine's name appears on a list of thousands of unsecured creditors with claims against the company. Among them are Ron Deutsch, a former counsel at Paul, Weiss, Rifkind, Wharton & Garrison hired last year by Celsius to be its general counsel and head of mergers and acquisitions.