JPMorgan Chase’s foray into the blockchain ecosystem continues, with the monetary establishment selecting the Base community to pilot its newly launched deposit token, JPMD.
The pilot program was confirmed by Naveen Mallela, an govt at JPMorgan’s blockchain division, Kinexys, who instructed Bloomberg {that a} fastened quantity of JPMD tokens will likely be transferred to crypto alternate Coinbase within the coming days.
The switch will likely be facilitated via Coinbase’s layer-2 blockchain, Base, which launched in 2023 and at the moment has the most important market share amongst Ethereum layer-2s, in keeping with CoinGecko.
Mallela stated the transaction will likely be denominated in US {dollars}, with further currencies supported after regulatory approval is granted.
Upon completion of the pilot part, which is anticipated to span a number of months, Coinbase’s institutional shoppers will acquire entry to JPMD for transactions, in keeping with Mallela.
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Deposit tokens are “superior” to stablecoins
The pilot testing was introduced days after JPMorgan filed a trademark application for JPMD, which outlined a spread of crypto-related companies, together with digital asset buying and selling, transfers and cost processing.
Deposit tokens, particularly, symbolize greenback deposits held in clients’ financial institution accounts. In contrast to stablecoins — digital representations of fiat currencies backed by money and money equivalents — deposit tokens function throughout the conventional banking framework.
“From an institutional standpoint, deposit tokens are a superior different to stablecoins,” Mallela instructed Bloomberg, noting that their fractional reserve backing makes them extra scalable.
The chief famous that JPMD might doubtlessly pay curiosity sooner or later, setting it aside from most stablecoins, which generally don’t generate yield.
Nonetheless, yield-bearing stablecoins could acquire momentum over time, with some business insiders suggesting that the highly effective US banking lobby is “panicking” over their potential to disrupt conventional monetary fashions.
In accordance with sources near the banking foyer, New York College professor Austin Campbell stated banking executives worry they are going to be “harmed” by the rise of yield-bearing stablecoins.
Cointelegraph by Sam Bourgi JPMorgan Pilots Deposit Token JPMD on Coinbase’s Base Network cointelegraph.com 2025-06-17 20:16:12
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