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Banking Giant JP Morgan To Launch Their Own Digital Currency

by icosuccess
, Banking Giant JP Morgan To Launch Their Own Digital Currency

J.P.Morgan, the banking giant is launching its own coin in a bid to transform the payments industry. JPM coin will facilitate payment settlement between clients with a small fraction of payments scheduled for a pilot program in a few months from now. J.P. Morgan is the first major U.S. bank to launch a digital currency. According to reports, JPM coin would be backed by USD, similar to other stablecoins like USDT and TUSD. Umar Farooq, the bank’s head of digital treasury has said, “Anything that currently exists in the world, as that moves onto the blockchain, this would be the payment leg for that transaction. The applications are frankly quite endless.”

JPM Coin Customer Trial

Clients would deposit USD in the bank and they will be issued JPM coins. The coins can be used for settling payments or buying bonds and securities on the blockchain. To settle these transactions J.P.Morgan will burn the coins and deposit proportionate USD in the customer’s bank account. Early applications would include international payments for corporate clients, bond and securities transactions, and institutional clients.

JPM coin would facilitate settling of fiat transactions on the blockchain. Thus facilitating a wide variety of applications involving individuals, corporations or institutions. The bank believes that they will have an edge over other digital currencies due to first mover advantage and large market share. This is expected to drive adoption in the first few months.

The trials are being conducted in the hope that eventually regulatory permission will be granted for the official use of JPM coin. The currency runs on top of a private version of Ethereum called Quorum, which was developed by the bank in the last quarter of 2016.

JPM Coin

JPM coin will function as a stablecoin and customers will receive it in exchange of fiat currency. The coin will be transferred via a private blockchain. The recipient of the coin can redeem it for USD.

The coin is expected to be extended to other fiat currencies in a few months however, it could take a longer time for licensing and approval. Clients that have undergone regulatory checks like big banks, corporations, and broker-dealers can use this token.

J.P.Morgan’s clients in the USA, Europe, and Japan have shown an interest in settling transactions using JPM coin. The bank moves $6 Trillion around the world every single day. This coin could potentially save millions of dollars in remittances. The bank has previously shown an interest in blockchain applications and now we’re witnessing the launch. They filed a patent for an interbank payments system in May 2018.

The Quorum Blockchain development had started in 2016 and now it ready for trial.

Future of JPM Coin

Back in 2017, Chairman and CEO of J.P.Morgan Chase, Jamie Dimon, has been a skeptic calling Bitcoin a “fraud”. He compared it tulip bulbs and said it wouldn’t last long. He also maintained that blockchain technology and currencies that are regulated hold a promise for the future. JPM coin would be backed by USD, and the value would fluctuate, akin to other stablecoins. It will be interesting to follow customer trials and any future decisions by the regulatory authorities.

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