Investing.com – Bitcoin fell on Friday erasing earlier gains as J.P. Morgan Chief Executive Jamie Dimon warned that governments will “close down” bitcoin and cryptocurrencies if they grow too large.

On the U.S.-based Bitfinex exchange, bitcoin fell to $3,575.5, down $28.4, or 0.79%. The slump in Bitcoin took its market cap below $60bn.

More than a week after Dimon sent shockwaves through the cryptocurrency space, warning that Bitcoin is a “fraud” and “will blow”, the JP Morgan boss warned that governments will eventually crack down on cryptocurrencies to gain a measure of control.

"Right now these crypto things are kind of a novelty. People think they're kind of neat. But the bigger they get, the more governments are going to close them down," Dimon said during an interview with CNBC-TV18 in New Delhi on Friday.

Proponents of the popular digital currency, however, often downplay the negative impact of government intervention in Bitcoin as the decentralized nature of blockchain – the software supporting the digital currency – has made it difficult for governments to form a clear consensus on how to regulate the digital currency.

Jamie, however, offered an alternative scenario suggesting that governments could attempt to curb the growth of bitcoin by threatening anyone who buys or sells bitcoin with imprisonment.

Bitcoin Cash fell 2.12% to $407 while Ethereum gained 5.60% to $2558.63.

Related Articles

Bitcoin Falls as JP Morgan's Dimon Issues Fresh Warning on Bitcoin

Bitcoin Tumbles 6% as Rally Runs Out of Steam

Swisscom sets up blockchain unit to develop apps in Switzerland