JPMorgan has taken a significant step in the cryptoasset ecosystem, launching JPM Coin (JPMD), a deposit token developed for corporate clients, on the Base blockchain. With this step, the bank is ushering in a new era combining traditional finance and blockchain technology.
JPMorgan Launches JPM Coin
JPM Coin is a "deposit token" representing US dollar deposits. In other words, each JPMD represents an actual bank deposit at JPMorgan. Unlike reserve-backed stablecoins, it integrates directly into the banking infrastructure. Corporate clients can now make near-instant transfers 24/7 using this token. This offers a significant speed and efficiency advantage compared to the limited business hours of traditional banking.
Following the completion of a pilot program launched in June, JPMorgan's digital payments unit, Kinexys, launched JPMD on Base. Developed by Coinbase, Base is known as Ethereum's Layer-2 solution. This step is also noteworthy as it marks the first time a major bank has offered a corporate payment solution on a public blockchain. According to information shared by the bank, major financial institutions such as B2C2, Coinbase, and Mastercard have successfully completed test transactions.
Naveen Mallela, global co-president of Kinexys, summarized JPMorgan's strategy by saying, "We are advancing transactions on public blockchains. Our starting point was Coinbase's Base network." Mallela also confirmed that JPM Coin will be expanded to include various currencies in the future. The bank has registered a trademark for a euro-denominated version called "JPME." This is being interpreted as a precursor to the transition to multi-currency support for digital deposit tokens.
Deposit tokens appear to be the next vehicle for digital transformation in the banking system. Each token is backed one-to-one by the deposit held at the bank, providing the user with a secure, transparent, interest-bearing digital asset. This allows both companies and financial institutions to complete high-volume transactions or international payments in seconds and at low cost. Coinbase is also reportedly accepting JPM Coin as collateral, which could expand the token's use in crypto markets.
With this initiative, JPMorgan offers a regulatory-compliant, enterprise-grade model for blockchain-based payments. The bank's digital payment network, Kinexys, currently handles over $3 billion a day in dollar, euro, and sterling transactions. JPMorgan's inclusion in this framework will increase both liquidity and network functionality.
JPMorgan's move signals a new era in global banking. Other major banks, including BNY Mellon, HSBC, and Barclays, are also working on similar tokenized deposit solutions.
