JPMorgan Introduces JPM Coin on Base Blockchain

JPMorgan Chase & Co, one of America’s largest banks, has begun implementing the deposit token JPM Coin (JPMD) for institutional clients, according to Bloomberg. 
The token operates on the L2 network Base from the cryptocurrency exchange Coinbase, enabling 24/7 payment processing. Transfers take seconds instead of the several days typical of traditional banking transactions. 
According to Navin Mallela, global head of JPMorgan’s blockchain division, JPM Coin has already undergone a test phase involving Mastercard, Coinbase, and B2C2.
The pilot version of the JPMD token was announced in June. The bank has already registered the ticker JPME for a potential launch of a euro-pegged deposit token.
These assets represent digital versions of client deposits in a commercial bank. They differ from “stablecoins”, which are backed by a basket of securities or fiat currency. 
In the future, JPM Coin could become an interest-bearing asset and be included in the deposit insurance system. The token is planned to be used as collateral on Coinbase.

“We believe that while stablecoins attract a lot of attention, deposit products offer a compelling alternative for institutional clients. They can generate income,” said Mallela. 

Despite the active development of the blockchain direction, the volume of digital asset transactions at JPMorgan still lags behind “traditional” operations. The bank’s network processes about $3 billion daily, compared to approximately $10 trillion in regular payment modes.

Similar Initiatives 

BNY Mellon is also working on a deposit token. The bank’s head of treasury services, Carl Slabicki, noted that such assets could help financial organizations “overcome the limitations of outdated technologies, simplifying the movement of deposits and payments within their own ecosystems.” 
In May, HSBC announced the launch of a tokenized deposit service for corporate clients in Hong Kong and Singapore. In September, the financial institution expanded the product to the UK and Luxembourg markets and added support for settlements in local currencies.