JPMorgan Launches Its Own Cryptocurrency; the first for a large American bank
The first cryptocurrency created by a major US bank is here – and it’s from JP Morgan Chase.
The New York-based bank has made the much-anticipated decision to launch its own digital token, CNBC reported Thursday.
A “tiny fraction” of the bank’s $ 6 trillion in daily transactions will be carried out by its new “JPM Coin” to settle international payments anytime of the day and in seconds, said Umar Farooq, project manager JP Morgan blockchain. It will also be used for securities transactions and for businesses using the bank’s treasury services, the bank confirmed in a blog post.
As each JPM coin is exchangeable for a single US dollar, it shares the qualities of a stable coin. CNBC clarified that “customers will receive the coins after depositing dollars in the bank; after using the tokens for a payment or security purchase on the blockchain, the bank destroys the coins and returns the customers a proportionate number of dollars. “.
When approached to comment on a rumored stablecoin announcement in January, the bank’s representative, Brian Marchiony, told The Block that the company had no such plans underway. Blockchain manager Christine Moy explained this morning âthis was not planned for the announcement at the time of [our] demand.”
The trial will begin in the coming months, when the coin goes live, becoming one of the first real-use banking apps for a cryptocurrency. JPM Coin will be issued on Quorum and âsubsequently extended to other platformsâ and âusable on all standard Blockchain networksâ.
While CEO Jamie Dimon has previously spoken with skepticism about bitcoin, calling it a “fraud” and banning its purchase from credit card users, the move suggests the bank is starting to see the potential of crypto assets. Space reacted with surprise to the bank’s altered outlook, with some showing skepticism of the token trial.
âJP Morgan continues to be wrong,â said Timo Schlaefer, CEO of Crypto Facilities. âUsing blockchain to run a closed network is like wearing a designer suit to wash your car. ”
Looking further, the JPM coin could be used for payments on internet-connected devices if this use for blockchain spreads, Farooq said.
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