John Sedunov, PhD

Professor of Finance and Real Estate | Villanova School of Business Villanova University

  • Villanova PA

John Sedunov, PhD, is an expert in banking, cryptocurrencies and financial institutions.

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Spotlight

2 min

The Rise and Fall of Cryptocurrency—Again

2021 saw a meteoric rise in the value of Bitcoin and other cryptocurrencies. In addition, a reported 16% of Americans say they have invested in, traded or used cryptocurrency. But over the last two months, the value has dropped significantly. In September, El Salvador made Bitcoin a legal tender in the country and lost more than 20% of its investment in the four months since, resulting in the International Monetary Fund asking the country to stop its embrace of the currency. We have seen this song and dance before with cryptocurrency values dramatically rising and falling, but where do we go from here?  According to Villanova University's John Sedunov, PhD, an associate professor of finance, people might have invested in crypto as a hedge against rising inflation in the last year because there weren't alternatives to the stock market, which itself has seen its fair share of volatility. If that trend continues and inflation concerns aren't erased, more Americans could invest in crypto.  As crypto continues to work its way into the everyday vernacular, there could be an interesting player to help bring it more mainstream: traditional banks. Recently, JPMorgan announced a $12 billion investment into technology. JPMorgan, which has already launched one of its own digital coins, is ahead of the competition.  "I think if anything is going to lead the way, as backwards as it is, it will be the traditional banks, specifically JPMorgan," Dr. Sedunov said.  "Their reputation will bring competitors to market, allowing for the potential to become more mainstream." One of the key things, Dr. Sedunov notes, is that there needs to be wide knowledge and understanding about how cryptocurrency, and the blockchain where it's stored, actually works.  "Until it's easier to understand and explain and becomes common knowledge, it's going to be a rough ride. It has to get to the point where the utility and ease of use is not trivial. It's very easy to buy it, but to spend or move it, it's a painful process to avoid fees. It has to be easier to access."

John Sedunov, PhD

2 min

Indebted Chinese Real Estate Developer Could Become Systemic Risk

Recent speculation surrounding the property developer China Evergrande Group caused the S&P 500 to have its worst day since May. But what we should look out for is systemic risk, according to John Sedunov, PhD, associate professor of finance at Villanova University. Evergrande currently has the biggest debt out of all publicly traded real-estate management or development companies. “The big issue seems to be Evergrande’s ability to repay its debt. The bigger issue is a potential for systemic crises or contagion to unfold,” said Dr. Sedunov. Another possibility is that Beijing could allow Evergrande to default. “Evergrande is a large Chinese developer, and the Chinese government may allow it to fail. It owes a lot of money to financial institutions and other market participants,” says Dr. Sedunov. With these risks, assets were moved from stocks, oil and Bitcoin to much safer options. “What’s potentially at stake is a contagion event where institutions with large exposure to Evergrande experience distress or fail as a result of lost cash flows they are expecting from Evergrande. This scenario is exacerbated if the company is allowed to fail,” said Dr. Sedunov. Does this present any other future concerns? Per Dr. Sedunov, Evergrande’s collapse could also impact the housing market. “More at issue is also that the real estate sector in China looks to be quite overheated (and it may be here as well), and this could be a signal of a collapse in real estate values, which again can bleed back into the financial system,” he said.

John Sedunov, PhD

2 min

Is This Bitcoin's Time to Shine?

Bitcoin was invented in 2008 and launched in 2009, but after years of skepticism, it's finally becoming a part of mainstream conversation. The cryptocurrency's value has continued to rise since 2017, but with the start of 2021, its price has surged and many more companies are looking for ways to get involved. Tesla and Square have invested. (You can even buy a Tesla with bitcoins.) Goldman Sachs and JPMorgan are exploring ways to meet customer demand for cryptocurrency investment. A National Football League player converted half of his salary into bitcoins. And Major League Baseball's Oakland Athletics are offering a suite for the 2021 season at the price of one bitcoin. So, if it's been around for so long, why are we only seeing this mainstream push now? "I think the Bitcoin ecosystem is developing to the point where people can start to think about using it as a currency," said John Sedunov, PhD, an associate professor of finance who studies Bitcoin. "However, the price still remains volatile, and it isn't clear that the currency can maintain its current $50,00-to-60,000 value." While there are companies adopting and investing now, this will still be a gradual process, Dr. Sedunov says. "As businesses become better able to accept the currency, and perhaps more importantly better able to withstand and manage the volatility of Bitcoin, then the currency will become more widespread in its use. The process would be expedited if the entire supply chain accepted Bitcoin, rather than just the retailer and the end of the chain. This would smooth the process and allow people to utilize the currency without as much concern for converting it." Additionally, Dr. Sedunov notes that there needs to be a continued evolution of the ability of firms to accept and manage the currency, in addition to a reduction in the volatility of the currency. Smaller businesses may be at much more of a risk than large corporations and banks if there is price instability. But the value of Bitcoin won't be this high forever. As the country and economy continue to deal with the impact of the pandemic, there are growing concerns that inflation could be next, pushing consumers to other options, like cryptocurrency. "When the pandemic ends and there is, perhaps, more economic stability, Bitcoin's value will wane a bit, but I don't think it will fade to nothing," Sedunov notes. "The big question mark, to me, is the U.S. Dollar and inflation. Inflation expectations are rising, and this only pushes people more toward alternatives. If this trend continues, then perhaps economic stability will be a bit lower, and more people will flock toward Bitcoin."

John Sedunov, PhD

Media

Social

Areas of Expertise

Alternative Investments
Banking
Banking Regulation
Bitcoin
Blockchain
Cryptocurrencies
Federal Reserve
Financial Institutions
Fintech
International Mergers and Acquisitions
Political Economy
Risk Management
Tariffs
Trade
Systemic Risk and Financial Crises

Biography

Dr. John Sedunov's research and teaching interests include risk management, financial crises, banking and systemic risk. He is a go-to media expert for Bitcoin and other cryptocurrencies as well as FinTech. Dr. Sedunov can also discuss the economic ramifications of political developments and policy changes.

Education

The Ohio State University

PhD

The Ohio State University

MA

Carnegie Mellon University

BA

Select Accomplishments

Honorable Mention, Global Leadership Research Excellence Award

2014

Recipient, Global Leadership Research Excellence Award

2016

Semi-Finalist, Best Paper Award, Financial Management Association Conference

2016

Select Media Appearances

What Does the Moody's Rating Downgrade Mean for the Economy?

ABC News  

2025-05-19

Investors sold off U.S. debt over the weekend after a high-profile downgrade of the nation's credit, stoking concern about rising borrowing costs as long-term Treasury yields spiked... "When you have a credit downgrade, that signals higher risk, which means higher payment to bear that risk," John Sedunov, a finance professor at Villanova University's School of Business, told ABC News.

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Why Credit Card Rates Remain High, Even After Interest Rate Cuts

ABC News  

2024-11-14

Policymakers at the Fed forecast another quarter-point cut next month, and cuts next year totaling one percentage point, but that will still leave interest rates at an elevated level, according to projections released in September. "I don't think the Fed wants a rapid fall in rates," John Sedunov, a finance professor at Villanova University's School of Business, told ABC News. "It wants to gradually ease rates back."

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A Popular Trading Strategy Just Blew Up in Investors' Faces

CNN  

2024-08-07

A carry trade is when you borrow money in a place where interest rates are low and use it to invest elsewhere in assets that generate some kind of return. For years, the place to get money on the cheap has been Japan, where interest rates have held steadily at or near zero... Borrowing for next to nothing and getting a 5% return on a U.S. Treasury sounds like a no-brainer. "It's pretty good arbitrage, but it's not really arbitrage because it's not risk-free," said John Sedunov, a finance professor at the Villanova School of Business. "You need to have the exchange rate work in your favor."

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Select Academic Articles

The Life Cycle of Systemic Risk and Crises

Journal of Money, Credit and Banking

Allen N. Berger and John Sedunov

2024

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The Role of Investor Sentiment in Bank Liquidity Creation

Finance Research Letter

Jin Cai, Michael S. Pagano and John Sedunov

2023

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Federal Reserve Intervention and Systemic Risk During Financial Crises

Journal of Banking and Finance

John Sedunov

2021

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