JPMorgan Bank is Set to Develop its Own Cryptocurrency-JPM Coin

JP Morgan says that its cryptocurrency could serve as a sort of corporate stablecoin. | Source Shutterstock

JP Morgan says that its cryptocurrency could serve as a sort of corporate stablecoin. | Source Shutterstock

Business-to-business volumes are well over $100 trillion, the report added.

The report relays that the bank backed crypto will be used initially to instantly settle global payments between clients; "expanding further" if it proves successful.

Treasury services. J.P. Morgan now hold large amounts of dollars in subsidiaries across the world.

Once corporate adoption takes off, Farooq said that the bank might even try to expand its cryptocurrency into device-based payments. Farooq says: "Is there a way to ensure that a subsidiary can represent cash on the balance sheet without having to actually wire it to the unit? That way, they can consolidate their money and probably get better rates for it". At this point of time, JPM Coin is more likely a stable coin.

Secondly, JP Morgan's token may also be used for securities transactions. However, few Engineers at Bank have rolled a new coin on Bank's name which intends to transfer the minimum payment in initial.

"The JPM Coin will be issued on Quorum Blockchain and subsequently extended to other platforms".

Nevertheless, with a financial institution as entrenched as JP Morgan taking the plunge into actual blockchain payments, perhaps skeptics will be more willing to give JPM Coin's decentralized cousins a closer look.

Per Farooq's statement, JPM coin will be on board for three key reasons.

Under the system announced Thursday, customers would receive JPM Coins that could be transferred to other customers, who would then be free to redeem the sum. "The product and technology capabilities are currency agnostic", according to the FAQ.

Lou Kerner, a venture capitalist who invests in crypto ventures, predicted the blockchain technology would affect all industries, much like the Internet.

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When the worldwide payments are tested, it will be one of the first real-world applications for a cryptocurrency in banking.

However, critics of JP Morgan's digital currency bring up the fact that blockchain is decentralized by design with no one party controlling transactions sent over the network.

Although the amount moved by JP Morgan's own cryptocurrency will reportedly be minuscule at first, there is nothing stopping these volumes from growing once JP Morgan has worked out all the kinks.

The bank is also running a blockchain payments trial launched in conjunction with Australia's ANZ and the Royal Bank of Canada.

How does JPM Coin work?

In the future though, JP Morgan envisions a network where clients, such as large banks, can move coins between themselves on the network without the bank being able to see the transactions. But it's not the same as gold or fiat currencies. It generated $9 billion in revenue previous year for the bank.

JPMorgan Chase, the nation's largest bank, is launching its own cryptocurrency.

As Bitcoinist reported, CEO Jamie Dimon became infamous after calling Bitcoin a "fraud" in 2017 - managing to move the entire Bitcoin price in the process.

UPDATE (14, February 14:30 UTC): This article has been updated with additional information released by JPMorgan. It won't end well.

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