Morgan Stanley CEO James Gorman sees more potential in bitcoin and other digital currencies than his counterpart at JPMorgan.

Cryptocurrencies are “certainly something more than just a fad,” Gorman said at a Wall Street Journal event Wednesday.

That contrasts with JPMorgan Chase CEO Jamie Dimon’s remarks earlier this month that bitcoin is a “fraud” and the mania around it “won’t end well.”

Gorman also took a different position from Dimon on the relationship between governments and digital currencies.

While Dimon said earlier this month that governments will eventually crack down on cryptocurrencies, Gorman pointed to how broader technological trends may actually force authorities to adapt.

“None of us operate in isolation in the ecosystem in which we live,” Gorman said. “If banks behave badly, the government says, ‘Raise more capital.’ We say, ‘Gee, that makes us less profitable,’ and they say, ‘That is now your problem.'”

“If [cryptocurrencies] are operating by enabling people to transfer more money, the government can say, ‘We’re not going to allow that anymore,'” he said. “So there is a sort of government risk factor to it.”

The Wall Street Journal discussion did not specifically mention bitcoin, the digital currency with the largest market capitalization. The value of more than 1,000 digital currencies listed on CoinMarketCap is now above $140 billion.

Bitcoin topped $4,000 Wednesday, up more than four times in value this year. The digital currency is still about $900 below its all-time high hit earlier this month, before a Chinese crackdown on digital currencies.

Gorman added, in response to a question, that he doesn’t think cryptocurrencies should be illegal.

“I haven’t invested in it,” he said. “I’ve talked to a lot of people who have, and it’s obviously highly speculative, but it’s not something that is inherently bad. I think it’s a natural consequence of the whole blockchain technologies, as I understand it,” he added.

Listen to the full Wall Street Journal interview here.

— CNBC’s Catherine Campo contributed to this report.

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