The largest bank in the United States, JP Morgan Chase, said a large tech client has already started using their cryptocurrency to instantly send and settle payments around the world.
Dubbed “JPM Coin,” the stablecoin facilitates the transfer of payments between institutional clients, the latest step in Wall Street’s evolving approach to the crypto space. The coin, however, will only be available for international payments to large corporate customers, which have undergone regulatory scrutiny.
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The name of the “big customer” involved in the process was not mentioned. But the development is huge for the wholesale payments business, as JP Morgan moves more than $ 6 trillion every day to more than 100 countries for its corporate clients. They will also be the first real-world applications for a cryptocurrency in the banking sector, replacing decades-old networks like Swift, with others coming shortly after international payments testing.
In June, the New York-based lender began trials of its JPM Coin alongside corporate clients with the ultimate goal of accelerating transactions, such as cross-border payments and corporate debt issuance.
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Takis Georgakopoulos, the bank’s global head of wholesale payments, described the project as part of a much broader trend towards the tokenization of financial assets.
JPMorgan, which once its CEO Jamie Dimon criticized cryptocurrencies as a fraud that won’t end well for its investors, has created a new unit to run its blockchain business. Called Onyx, Georgakopoulos told CNBC that the new department employs more than 100 dedicated employees.
“We are launching Onyx because we believe we are moving into a commercialization period of those technologies, moving from research and development to something that can become a real business,” he added.
JPMorgan is also expanding the experiment with the release of its own blockchain platform, Quorum, which allows institutions to track financial data.
JPMorgan wasn’t the only financial institution to explore the potential of tokenization and stablecoins as part of its efforts to modernize legacy payment systems. Goldman Sachs also said it might consider launching a cryptocurrency after JPMorgan Chase became the first US bank to launch its own digital token.
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