John McAfee on Wednesday (9/14) challenged JPMorgan CEO Jamie Dimon's skepticism of #bitcoin

ohn McAfee makes the case for why bitcoin is headed to $500K
John McAfee claims bitcoin is headed to $500K

John McAfee on Wednesday challenged JPMorgan CEO Jamie Dimon's skepticism of bitcoin.

Dimon on Tuesday called bitcoin a "fraud" that will eventually blow up. McAfee, whose company MGT Capital Investments mines the cryptocurrency, said he respects Dimon and people in his position "are not idiots," but he challenged Dimon's criticism.

"You called bitcoin a fraud," McAfee told CNBC's "Fast Money" on Wednesday. "I'm a bitcoin miner. We create bitcoins. It costs over $1,000 per coin to create a bitcoin. What does it cost to create a U.S. dollar? Which one is the fraud? Because it costs whatever the paper costs, but it costs me and other miners over $1,000 per coin. It's called proof of work."

Miners invest "massive" amounts of supercomputing power and electricity in creating bitcoins, McAfee said. Surely then, there is value in creating a bitcoin, he added.

Bitcoin has faced scrutiny because it is highly volatile. The cryptocurrency was last trading Wednesday evening at more than $3,870.

"And the fact that bitcoin is consistently growing in its use and its value has to say something," McAfee said. "Sure it will rise and fall as all new technologies are. But at the same time, it is certainly not a fraud."