This week, the JPM Coin will be used commercially by a large tech client to send payments around the world
After years of development, the US bank JPMorgan announced the launch of its stablecoin and blockchain protocol. The Chief Executive Officer (CEO) of the bank, Jamie Dimon, is known for being critical of Bitcoin in the past and for holding a bearish stance on the cryptocurrency market.
The bank’s global head of wholesale payments, Takis Georgakopoulos, confirmed that the JPM Coin is going to be used commercially for the first time this week by a big tech client to facilitate sending payments around the world.
The bank has also devoted an entire business vertical to a new blockchain and digital currency research division called Onyx. The interbank group that will be testing and interacting on the Onyx network has been renamed to “Liink”. Some crypto observers believe that the name of the group draws a few parallels with Chainlink, the world’s seventh-largest cryptocurrency according to market cap.
“We are launching Onyx because we believe that we are shifting to a period of commercialisation of those technologies, moving from research and development to something that can become a real business”, Georgakopoulos said.
JPMorgan is one of the world’s cross border payments giants, and moves around $6 trillion every day across more than 100 countries. Their current system is reliant on a complex web of correspondent banks around the world, and payments may get rejected due to errors in account information or other problems.
The Onyx network and the JPM coins are meant to solve these issues and streamline the process, with special focus on solving issues that are related to wholesale payments.
The CEO of Onyx, Umar Farooq, highlighted how banks could save millions of dollars by charging a few cents to confirm data for each transaction, which would cut down on the costs of remediating mistakes and creating a model for them to earn money by participating in the network.
JPMorgan is also looking into the creation of new and separate payment rails for central banks that are considering developing their own digital currencies. Georgakopoulos pointed to China and Singapore as examples.
The head of Onyx also explained that the bank was still waiting for the right time to announce the development.
“If you think about blockchain, we are either somewhere in the trough of disillusionment or just beyond that on the hype curve. That’s why at JPMorgan we’ve been relatively quiet about it until we were ready to scale it and commercialise it”, Farooq said.