JPMorgan Chase has officially launched JPM Coin (JPMD), a digital deposit token for institutional clients, signaling a major step forward as banks deepen their involvement in digital assets.
The digital coin represents dollar deposits at JPMorgan, enabling near-instant transfers using Coinbase’s public blockchain, Base, the Bloomberg report said, citing Naveen Mallela, co-head of JPMorgan’s blockchain group Kinexys.
This rollout enables payments to settle in seconds, anytime, 24/7, rather than taking days and being limited to business hours, and follows a month-long trial involving major players such as Mastercard, Coinbase and B2C2.
JPMorgan plans to eventually implement the token on other blockchains and provide clients’ customers with access to JPM Coin and expand the token to multiple currencies pending regulatory approval.
The coin will even be accepted as collateral on Coinbase, highlighting its growing role in crypto markets.
Deposit tokens are not stablecoins; rather, the digital claims on funds already in client bank accounts are designed to facilitate smoother blockchain transactions. Unlike traditional stablecoins, which are backed by reserves and typically do not generate returns to holders, deposit tokens can be interest-bearing, providing an attractive opportunity for institutional investors.
The launch builds on JPMorgan’s growing blockchain ambitions and is part of a wider wave of global financial firms, including Citigroup, Banco Santander, Deutsche Bank and PayPal, exploring digital tokens to speed and reduce payment costs.
The development follows the United States’ Genius Act, which regulates stablecoins, or dollar-linked digital tokens.
Other banks, such as Bank of New York Mellon and HSBC, are also developing similar deposit token solutions.
