JPMorgan Creates Stablecoin Called JPM Coin
JPMorgan, the leading US banking institution, has created its own dollar-pegged stablecoin — JPM Coin — and is preparing to test it, CNBC reports.
The cryptocurrency was developed by the bank’s specialists and will be used for corporate payment operations after testing. JPMorgan processes cash transactions worth $6 trillion on a daily basis.
Distributed ledger technology is expected to be widely recognized, and the bank will maximize its use in its work, but now the institution needs to achieve the speed of remittances typical for the operation of smart contracts, Umar Farooq, JPMorgan manager of blockchain developments, stated.
JPM Coin will be used in three directions. It will help corporate clients make quick international transactions and will be used in the transfer of securities. Besides, the stablecoin will be able to replace the funds of large corporations in US dollars kept in the vaults of the bank.
Each JPM Coin is equivalent to a dollar in a one-to-one ratio. After depositing their funds to the bank, customers will receive stablecoins, and after the completion of all settlement operations, JPMorgan will liquidate them and return deposits to the owners. In the future, tokens can be used to make mobile payments.
Only institutional organizations that are major bank customers will be involved in the testing of the stablecoins.
Earlier, Joyce Chang, JPMorgan research manager, stated that blockchain technology will be actively used in the trade and financial sphere in three to five years.