According to a recent report by CNBC, the new digital token, called “JPM Coin,” has been built as a means to instantly settle payments between clients.
“So anything that currently exists in the world, as that moves onto the blockchain, this would be the payment leg for that transaction,” said Umar Farooq, head of J.P. Morgan’s blockchain projects. “The applications are frankly quite endless; anything where you have a distributed ledger which involves corporations or institutions can use this.”
Farooq revealed there are 3 early applications for JPM Coin, including international payments for large corporate clients, securities transactions with instant settlements, and as a replacement for dollars held through JPMorgan’s corporate treasury services. Farooq also sees JPM Coin as a form of payment on internet-connected devices if that use for blockchain technology eventually catches on.
The revelation that JPMorgan has been working on its own digital currency comes (unsurprisingly) on the back of mixed signals coming from the bank for the greater part of the last 2 years. While Farooq previously indicated that the bank is a big believer in Ethereum, the bank’s CEO, Jamie Dimon, has had long been an unnecessarily outspoken critic of Bitcoin (BTC).
The launch of an Ethereum-based stablecoin is seemingly a natural extension of JPMorgan’s blockchain initiative, Quorum, an enterprise-level distributed ledger protocol forked from the Go Ethereum client. Farooq previously stated that JPMorgan clients have already begun to tokenize physical gold bars onto the Quorum blockchain to allow companies to capitalize on sustainable mining methods to earn a premium on global markets.
Despite the major news, the cryptocurrency market has failed to move higher, suggesting a lackluster response from established market participants to JPM Coin. The AltDex 100 Index (ALT100), a benchmark index that doesn’t include stablecoins, is currently down 0.6%. JPM’s own shares, on the other hand, are down 1% on the day to $102.03, giving the bank a $339.3 billion market cap.
More: JP Morgan is rolling out the first US bank-backed cryptocurrency to transform payments business
Photo: Maryland GovPics / Flickr
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.