In a surprising move, banking giant JPMorgan has announced the release of its cryptocurrency JPM Coin, claimed to be the first to be issued by a bank. The token will be used mainly to settle payments using the money, securities, and other assets by between the company\u2019s payment business clients.<\/p>\n
Umar Farooq, head of JPMorgan\u2019s blockchain operations, told CNBC<\/a> that trials of JPM Coin are expected to start in the coming months, describing three possible use cases for the token.<\/p>\n The first is for international payments for large corporate clients, which now typically happens using wire transfers between financial institutions on decades-old networks like Swift. Instead of sometimes taking more than a day to settle because institutions have cut-off times for transactions and countries operate on different systems, the payments will settle in real time, and at any time of day, Umar Farooq said.<\/p>\n The second is for securities transactions. In April, JPMorgan tested a debt issuance on the blockchain, creating a virtual simulation of a $150 million certificate of deposit for a Canadian bank. Rather than relying on wires to buy the issuance \u2014 resulting in a time gap between settling the transaction and being paid for it \u2014 institutional investors can use JPM Coin, resulting in instant settlements.<\/p>\n The final use would be for huge corporations that use JPMorgan’s treasury services business to replace the dollars they hold in subsidiaries across the world. Unseen by retail customers, the business handles a significant chunk of the world’s regulated money flows for companies from Honeywell International to Facebook<\/a>, moving dollars for activities like employee and supplier payments. It generated $9 billion in revenue last year for the bank.<\/p>\n \u201cMoney sloshes back and forth all over the world in a large enterprise. 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,”<\/strong> said Umar Farooq.<\/p><\/blockquote>\n Each JPM Coin is redeemable for a single U.S. dollar, so its value shouldn’t fluctuate, similar in concept to so-called stablecoins. Clients will be issued the coins after depositing dollars at the bank; after using the tokens for a payment or security purchase on the blockchain, the bank destroys the coins and gives clients back a commensurate number of dollars.<\/p>\n Despite the heavy criticism JPMorgan’s CEO Jamie Dimon has been throwing towards Bitcoin in the past, the bank\u2019s chief and his managers have consistently said blockchain<\/a> and regulated digital currencies held promise.<\/p>\n The bank is also running a blockchain payments trial launched in conjunction with Australia\u2019s ANZ and the Royal Bank of Canada. The three banks set up the project in October 2017, aiming to slash both the time and costs required for interbank payments using traditional methods.<\/p>\n Called the Interbank Information Network (IIN), the platform is built on Quorum, the Ethereum-based blockchain network developed by JPMorgan and possibly to be spun off into its own enterprise.<\/p>\n Last April, JPMorgan also partnered with National Bank of Canada and other major firms to trial Quorum with a debt issuance worth $150 million. The trial mirrored a $150 million offering the same day by the National Bank of Canada of a one-year floating-rate Yankee certificate of deposit.<\/p>\n Follow ForkLog on Twitter<\/a><\/span> and Facebook<\/a><\/span>!<\/p>\n","protected":false},"excerpt":{"rendered":" In a surprising move, banking giant JPMorgan has announced the release of its cryptocurrency JPM Coin, claimed to be the first to be issued by a bank. The token will be used mainly to settle payments using the money, securities, and other assets by between the company\u2019s payment business clients.<\/p>\n","protected":false},"author":1,"featured_media":6497,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"","cryptorium_level":"","_short_excerpt_text":"","creation_source":"human_written","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[229,564,807],"class_list":["post-6496","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-jpmorgan","tag-payments","tag-stablecoins"],"aioseo_notices":[],"amp_enabled":true,"views":"192","promo_type":"1","layout_type":"","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/6496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/comments?post=6496"}],"version-history":[{"count":2,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/6496\/revisions"}],"predecessor-version":[{"id":6499,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/6496\/revisions\/6499"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media\/6497"}],"wp:attachment":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media?parent=6496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/categories?post=6496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/tags?post=6496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}