The Rise of JPM Coin
Today, JP Morgan‘s Takis Georgakopoulos announced to Bloomberg that the JPM Coin is being used for an astounding $1 billion transactions daily. This blockchain instant payments solution, which was introduced for trials in 2019, has primarily been adopted by major institutions and large corporates. A notable example is Siemens treasury, which utilizes tokenized deposits to transfer money between its global subsidiaries around the clock.
Blockchain Innovations at JP Morgan
JP Morgan is not just stopping at the JPM Coin. The bank has also introduced a blockchain intraday repo platform and a fresh tokenized collateral management network. It’s speculated that a significant portion of the JPM Coin transactions are settlements on these platforms. As of June, the repo solution alone had processed trades worth $300 billion.
Expanding Horizons: Beyond the Dollar
Initially, the JPM Coin was designed exclusively for dollar payments. However, in June, euros were added to its capabilities. Georgakopoulos hinted at further expansions, possibly in connection with the recent news that Bahrain’s ABC Bank had initiated the JP Morgan Coin Systems solution. This solution is now being used for payments between Bahrain and several countries including the US, UK, Singapore, and Hong Kong. Moreover, the UAE’s FAB has recently completed a pilot, although a full commitment is still pending.
A Glimpse into the Future: Retail Blockchain Solutions
While JP Morgan has predominantly delved into wholesale and B2B blockchain solutions, this might soon change. Georgakopoulos shared with Bloomberg the bank’s vision for digital deposit tokens. He emphasized the
“next step in that journey is to think about how you can create a more retail version of that, so that you can bring that same efficiency to consumers.”
JP Morgan envisions this as a blockchain-based bank account where funds are moved into a separate account, tokenized, and then reversed on the receiving end.
The Three Buckets of Digital Payment Solutions
JP Morgan categorizes digital payment solutions into three main categories: an internal ledger, a shared ledger, and a universal ledger. The bank is involved in blockchain-based bank accounts and has also co-founded Partior, an interbank network for multi-currency payments. This initiative saw collaboration with DBS Bank, Temasek, and Standard Chartered. Furthermore, JP Morgan is participating in deposit token trials on public blockchain as part of a project with the Monetary Authority of Singapore.
JP Morgan’s JPM Coin is not just a testament to the bank’s innovative strides but also a reflection of the evolving financial landscape. With daily transactions reaching a staggering $1 billion, the JPM Coin is setting new standards in blockchain instant payments. The bank’s ventures into various blockchain solutions, from intraday repo platforms to tokenized collateral management networks, underscore its commitment to harnessing the power of blockchain technology. The potential expansion into retail blockchain solutions and the categorization of digital payment solutions further highlight JP Morgan’s vision for a future where blockchain seamlessly integrates with everyday banking. As the lines between traditional banking and digital solutions blur, JP Morgan stands at the forefront, leading the charge into a new era of financial technology
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