JPMorgan Chase is set to pilot its own digital currency, JPMD, in collaboration with Coinbase. Unlike traditional stablecoins, JPMD acts as a deposit token representing bank deposits on a blockchain. This initiative aims to enhance cross-border business payments and settle transfers continuously. Exclusively available to institutional clients, JPMD represents a strategic move by JPMorgan to stand out in the financial sector, especially as many companies lean toward stablecoins for their perceived stability. The partnership with Coinbase is designed to integrate institutional funds into a more expansive digital economy.
"This pilot combines the credibility of both JPMorgan and Base to help bring institutional money into a more global economy," Jesse Pollack, VP of engineering at Coinbase, said in a statement.
"We have always believed in having a token-based solution on public blockchains," Naveen Mallela, global co-head of JPMorgan Chase's blockchain division Kinexys, told Fortune.
The bank plans to issue JPMD on Base, a public Ethereum-based blockchain managed by Coinbase. It will be exclusively available to JPMorgan's institutional clients.
JPMorgan's decision to create a deposit token instead of a stablecoin is a noteworthy break in an otherwise new corporate trend, allowing the bank to stand out.
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