JP Morgan Chase launches its own cryptocurrency 'JPM Coin'
JPMorgan Chase has created a digital token, the JPM Coin, that will be used to instantly settle transactions between the bank's wholesale payments business clients. The bank will begin trials in the coming months, using JPM Coin for a "tiny" fraction of the $6 trillion it moves for corporations every day. While the pilot will be on a fairly small scale, it marks the first time a major US bank has created and used a digital coin in the real world.
JPM Coins, which are pegged to the US dollar, will be issued to clients after they deposit dollars at the bank. Then, after using the tokens for payments or security purchases on the blockchain, JPMorgan destroys them and gives the clients their dollars.
Umar Farooq, head, blockchain projects, JP Morgan, says that he sees three early applications for JPM Coin: international payments for corporates that are currently carried out over Swift; securities transactions; and as a replacement for dollars that massive firms hold at various subsidiaries around the world. Says Farooq: "The applications are frankly quite endless; anything where you have a distributed ledger which involves corporations or institutions can use this."