JPMorgan Chase - the largest bank in the world by market value - has begun deploying a token called JPM Coin, which represents its bank deposits.
Bloomberg reported on Wednesday that JPMorgan's institutional clients can now use JPM Coin. According to Bloomberg, Naveen Mallela, co-head of the bank's blockchain division, stated that the token represents dollar deposits within the bank, allowing users to transfer funds via the blockchain platform Base, developed by Coinbase and approved by JPMorgan.
In mid-June, Mallela announced that a fixed number of JPMD tokens would be transferred to Coinbase via Base in the coming days. This transfer is part of a pilot phase, after which Coinbase's institutional clients will also have access to the bank's deposit tokens.
JPM Coin enables faster and more flexible 24/7 real-time settlement services compared to the traditional U.S. banking system, effectively enhancing interbank transfer efficiency. Earlier this week, JPMorgan announced in collaboration with Singapore's multinational bank DBS that both parties are developing a blockchain-based tokenization framework to facilitate on-chain transfers between the deposit token ecosystems of the two banks, following this news.
As of the time of publication, JPMorgan has not responded to Cointelegraph's request for comment.
JPM Coin is a so-called deposit token, meaning it directly corresponds to bank deposits and thus constitutes a regulated liability of the issuing bank. This is the main distinction between such tokens and traditional stablecoins, which are issued by private entities and backed by assets.
Like the entire U.S. financial industry, JPMorgan appears to be intensifying its push for tokenization and blockchain technology. At the end of October this year, JPMorgan's private banking and asset management division completed its first transaction on the upcoming Kinexys Fund Flow fund tokenization platform.
The company is not only focused on blockchain-based tokenization but also shows strong interest in the broader crypto ecosystem. Reports at the end of October indicated that JPMorgan plans to allow clients to use Bitcoin and Ethereum as collateral for loans.
In mid-January this year, JPMorgan stated that the launch of a Solana ETF could attract $3 billion to $6 billion in inflows, while an XRP ETF could bring in $4 billion to $8 billion in new investments. Additionally, the bank has recently been reported to be formulating plans to offer cryptocurrency trading services.
Also in October, JPMorgan informed financial advisors that all clients would be able to invest in cryptocurrency funds. Previously, such products were only available to high-net-worth individuals with over $1.5 million in assets and a higher risk tolerance.
Related: Bank of England Deputy Governor Breeden warns: Easing stablecoin regulations could jeopardize financial stability
Original: “JPMorgan (JPM) Launches JPM Coin Deposit Token on Base for Instant Payments”
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