JPMorgan, the biggest US bank, is working on a new digital currency to make global payments faster, says a source.
A source, keeping their identity hidden due to the project’s early stage, revealed that JPMorgan is looking into creating a digital currency backed by deposits using blockchain technology. This digital currency would serve as a transferable representation of deposit claims.
They mentioned that although the necessary infrastructure is ready, the bank will wait for regulatory approval before proceeding with the token’s development. If regulators give the green light, JPMorgan could introduce this product to its corporate clients within a year.
JPMorgan sees deposit tokens as having great potential benefits, but they understand that regulators need to carefully consider them before they become a reality. If regulators show interest, JPMorgan’s blockchain technology is ready to support deposit tokens relatively quickly.
This deposit token represents an extension of JPMorgan’s efforts in blockchain technology, which already includes JPM Coin. However, unlike JPM Coin, the deposit token will allow for easy money transfers between JPMorgan’s clients and clients of other banks. It’s also well-suited for settling trades involving tokenized securities on the blockchain.
Deposit Tokens Could Revolutionize Financial Systems
Deposit tokens are like digital vouchers issued by banks, and they could change how our regular money systems work. Using blockchain tech, these tokens can make transactions super quick and cheaper. Plus, they’ll still follow all the rules and regulations that banks have to follow.
At first, these tokens will be in US Dollars, but they might expand to other currencies if the regulators say it’s okay. This idea is coming up while some folks think US regulators might be kinder to big banks when dealing with crypto companies.
JPMorgan Leading in Digital Tokens
JPMorgan is the first major U.S. bank to have its digital token for real-world use. They have launched a new deposit token and are expanding the use of their blockchain-based settlement token, JPM Coin. This coin allows users to transfer regular money stored with the bank. Since its launch, JPM Coin has processed over $300 billion in transactions, showcasing how traditional banks are embracing blockchain technology.
Last year, JPMorgan announced that clients had begun using their cryptocurrency to settle international payments instantly. However, this service is currently only available to corporate clients who have gone through rigorous regulatory checks.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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