THE RISE of bitcoin “will eventually blow up”, according to the boss of JP Morgan.

The bank’s chief executive Jamie Dimon took aim at the cryptocurrency this week.

Speaking at an investor conference in New York, the head of the bank - which has one of its UK bases in Bournemouth - called bitcoin “a fraud” and said he would fire employees found to be trading the digital currency.

“For two reasons: it’s against our rules, and they’re stupid. And both are dangerous,” Mr Dimon said.

“The currency isn’t going to work. You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart.

“Don’t ask me to short it. It could be at $20,000 before this happens, but it will eventually blow up. Honestly, I am just shocked that anyone can’t see it for what it is.”

Despite his objections to the use of currency, the banker revealed his daughter had bought bitcoin.

The virtual currency started following the financial crisis.

It allows people to bypass banks and traditional payment processes to pay for goods and services.

Mr Dimon’s comments sent the price of bitcoin tumbling by nearly 8%, to around $3,834.26.