JP Morgan considering a new blockchain-based settlement token
JP Morgan Chase & Co. could soon create a new blockchain-based digital deposit token, according to reports from Bloomberg on Sept. 7.
The new token would allow for faster cross-border payments and settlements. In fact, JP Morgan has reportedly built the infrastructure needed to handle transactions for the token, based on statements from anonymous sources familiar with the matter.
JP Morgan has not yet initiated the creation of the token, as this would necessitate approval from U.S. regulators – a process the company has not started. Bloomberg cited statements from a JP Morgan spokesperson indicating that the bank recognizes regulators’ “thoughtful and diligent” approach to approvals.
Nevertheless, JP Morgan could reportedly introduce the token and start offering it to clients within a year of approval from regulators.
Similar to JPM Coin, but different
It appears that the planned token is similar in some ways to the company’s existing JPM Coin. Based on the reporting, the upcoming deposit tokens represent customer deposits and are moved on blockchain rails. JP Morgan’s website similarly describes JPM Coin as representing dollars “held on deposit” and circulating on the company’s distributed ledger, described elsewhere on the page as a blockchain.
Like JPM Coin, the new token would be restricted to bank use rather than retail use, and it would rely on know-your-customer (KYC) and compliance systems.
However, the planned deposit token would differ from JPM Coin in specific ways. Notably, the new token would allow money to be sent to other banks. It could also be used to settle trades involving tokenized securities and financial instruments. Furthermore, the new deposit token could be offered in a variety of currencies apart from the U.S. dollar — though JPM Coin itself expanded to support the euro this year.
Bloomberg cited an earlier statement in which JP Morgan expressed optimism for deposit tokens, stating that believes such assets will become a “widely used form of money.” One of the company’s 2022 pilot projects also involved deposit tokens.
The post JP Morgan considering a new blockchain-based settlement token appeared first on CryptoSlate.
Filed under: Bitcoin - @ September 7, 2023 10:20 pm