JPM Coin (JPMorgan Chase) is a bank-backed US dollar collateralized digital stable coin which leverages blockchain to make efficient payments across borders. The fiat currency-based cryptocurrency coin uses the US dollar at a 1:1 ratio as collateral for price stabilization and liquidity.
Related Articles
Blockchain is offering the solution to the pertaining problems of transparency, speed, and intermediary parties. The digital ledger provides a channel to transfer value, data, and information in a trustless and peer-to-peer environment regardless of the geolocations. This inspired JPM Coin creation back in 2019 on Onyx.
Why was the JPM coin created:
Fiat currencies are government-issued currencies like US dollars, Euros, or Dirhams. Governments and banks decide the value of these currencies and they move in a fully centralized ecosystem. When banks decide to print more cash, inflation hits and the Fiats devalues ultimately. Fiats are soft capped assets meaning governments can print as many notes as they want and only a few in power can decide or vote on this. Another problem is, Fiats are transferred in fully centralized channels these conventional ways are a lot slower, involve intermediaries, and are inefficient. Especially, when it comes to cross-border payments these assets are very difficult to transfer and even take days to transfer. The JPM Coin addresses these two problems perfectly, thanks to the blockchain.
JPM Coin leverages cutting-edge blockchain technology to offer solutions to complex business problems. Every JPM coin is a digital token that represents one US dollar and its value remains stable concerning the fiat. The difference is, you can transfer JPM coin to anywhere in the world in a few minutes using the digital ledger. Now JPM clients can deposit their fiat to get JPM coins. They can use this coin to facilitate transactions on the blockchain network and with other clients. Clients can redeem their fiat assets with the JPM coin whenever they want to.
How JPM Coin is different from other Stable Coins:
First and the main difference is this coin is not for the individuals like other cryptocurrency stable coins. This permission-based coin doesn’t have public access instead it is accessible to the institutions. Also, the coin was created to facilitate the funds’ transfer while other stable coins are more of an investment tool. JP Morgan Chase is one of the largest banks in the world which is fully compliant with the US and other countries where it functions. When it comes to other cryptocurrencies, they hide behind the cloak of decentralization to dodge transparency. This makes the JPM coin more stable, trusted, and safer than those classic stable coins USDT or BUSD.
JPM in Crypto Space:
Like every other bank, JP Morgan is on a quest to use technological tools to enhance user experience through various approaches. Not just a coin, JP Morgan is coming with a fully functional financial ecosystem backed by the Onyx blockchain platform. JP Morgan’s Onyx provides an environment for efficient payments and banking experience through strengthened liquidity and autonomous settlements. Onyx makes JPM the pioneer and forefront of the banks to shift their scale to blockchain efficiency, transparency, cost-effectiveness, and immutability.
JP Morgan is shifting classical finance to an enhanced version of Decentralized Finance (DeFi) – simply the future of Finance. JP Morgan’s Onyx is a blockchain platform that is redefining the payment systems in banking systems. JP Morgan is commercializing these blockchain tools and has started making profits from these tools already. Georgakopoulos explains,
“We are launching Onyx because we believe we are shifting to a period of commercialization of those technologies, moving from research and development to something that can become a real business.”
Liink, yet another too by JPM, enables institutions to share the information and data more efficiently. Liink is claimed to be the largest network of banks worldwide. This helps to move the assets across the border through a hopping approach to avoid the sanctions through a set network of banks around the globe. The banks are connected in a peer-to-peer way, using blockchain, for verification and augmented information to only involved banks through a bilateral mechanism.
Recently, the Central Bank of Bahrain has successfully tested the JPM coin by sending real-time payments to counterparties in the US. Blockchain is transformational when it comes to Finance, and JPM is spending significant resources to be the forefront and pioneer bank in the arena. JPM coin is the first bank-backed stable coin that bridges the decentralized world of cryptocurrencies to the centralized yet stable world of banks and fiats. The JPM Coin offers all the perks of any cryptocurrency stable coin excluding the nefarious volatilities. While other banks fear Bitcoin and decentralization, JPM is building the whole infrastructure on the blockchain, and what more, the technology is winning endorsements from banks and even IMF (international Mandatory Funds) and BIS (Bank for International Settlements).
