JPMorgan is launching JPM Coin, its dollar deposit token, on Ethereum and will offer it to the bank’s institutional clients there, the bank said in a statement on Monday, Bloomberg reported.
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Why Ethereum
Ethereum’s liquidity, and the fact that the bank’s clients are already on it, decided the pick, said Emma Landriault, global head of Kinexys Labs at JPMorgan’s blockchain unit Kinexys.
“We’ve clearly been in a year of further convergence between Wall Street and crypto,” Landriault was quoted by Bloomberg as saying in an interview. “It’s not just Wall Street going to public chains, but the institutional web3 players getting more embedded and partnering with traditional financial institutions.”
Who It’s For
Landriault reportedly told Bloomberg that JPM Coin is aimed at two groups. One is big crypto firms that pay onchain. The other is financial institutions active in tokenized assets, which can use the token as onchain cash to close out those trades or post it as collateral against them.
The token represents U.S. dollar deposits at JPMorgan. It debuted last year on Base, a blockchain affiliated with Coinbase. Clients can use it to move dollars in seconds at any hour, any day, where a transfer can otherwise take several days and runs only within business hours.
A Public Chain for a Private-Network Bank
Tokenization, the practice of representing funds, bonds, stocks and similar assets on a blockchain, is not new for banks, which have been trying it for over a decade. A large share of those trials ran on permissioned systems where banks control access. JPM Coin’s move to Ethereum puts it on a public chain, though holding it remains restricted.
JPMorgan already operates its own private blockchain, the Kinexys Blockchain Deposit Account network, where corporate clients transfer dollars, euros, pounds and several other currencies. According to JPMorgan, daily volume on that network tops $7 billion; Bloomberg reported that the bank’s payments arm as a whole handles around $12 trillion in daily payments.
Companies outside banking are also issuing digital dollars. Last month, Open Standard launched Open USD (OUSD), a dollar stablecoin backed by Visa, Mastercard, Stripe and others, on Ethereum, Solana, Base and Tempo.
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