The lender will begin trials of its new digital token "JPM Coin" over the next few months, which was created by engineers at the New York-based bank to instantly settle payments between clients.
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.
A "tiny fraction" of the bank's $6 trillion in daily transactions will be conducted by its newly created "JPM Coin" to settle worldwide payments at any time of the day and within seconds, said Umar Farooq, head of J.P. Morgan's blockchain projects.
In an attempt to reposition itself after Jamie Dimon's past controversial comments, Farooq tries to convince us this is part of the master plan: "We have always believed in the potential of blockchain technology and we are supportive of cryptocurrencies as long as they are properly controlled and regulated". 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?"
"The JPM Coin isn't money per se". What Does JP Morgan Mean by 'Cryptocurrency?' Unlike bitcoin, only big institutional clients of J.P. Morgan that have undergone regulatory checks, like corporations, banks and broker-dealers can use the tokens. While only a portion of that will be dedicated to a pilot test integrating JPM Coin, to put things into perspective, only 2% of JP Morgan's $6 trillion in daily payments would be worth as much as the entire current cryptocurrency market cap. "That way, they can consolidate their money and probably get better rates for it".
"As a globally regulated bank, we believe we have a unique opportunity to develop the capability in a responsible way with the oversight of our regulators", said JPMorgan's Head of digital treasury services and blockchain Umar Farooq. So, even just using the token among JPMorgan clients "shouldn't hold us back".More news: Cardi B forced to defend Grammy win and her reaction is epic
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What Are JPM Coin's Use Cases?
JPMorgan said its new coin, which will be issued on its in-house blockchain technology Quorum, was now a prototype.
However, with the incipient JPM Coin on the way, it seems as if Ripple will have to compete even harder if they're to win over any further business from major banks.
While JP Morgan has laid out what it hopes to do with JPM Coin, it has been less transparent about the technical details of the token. It won't trade freely like bitcoin and many other cryptocurrencies.
On Valentine's day, major investment bank JP Morgan showed some love to cryptocurrencies.
For more on J.P. Morgan's cryptocurrency, follow on over to CNBC. Finally, CryptoSlate takes no responsibility should you lose money trading cryptocurrencies. Although, still an agenda for the future, it will be a major milestone in the bank's plan for a worldwide crypto dominance.