J.P. Morgan Uses Its Own Token “JPM Coin” To Settle A Payment In Europe
Milestone Date: June 24, 2023
J.P. Morgan successfully executed its first blockchain transaction for corporate clients in Europe, using its proprietary token, the JPM Coin. The transaction was done by Siemens AG, a Germany-based enterprise. The payment was carried out on JP Morgan's own permissioned blockchain platform. According to a bank executive's statement to Bloomberg, this marked the first-ever Euro-denominated JPM Coin transaction.
The bank stated that JPM Coin is exclusively accessible to its institutional clients and is limited to facilitating payment settlements.
J.P. Morgan introduced its Coin Systems service, one four offerings under its Onyx portfolio of blockchain offerings, back in 2019. This platform enables transfers between client accounts to be completed via blockchain technology rather than traditional payment rails (aka “Traditional Finance” or “TradFi”) such as wire transfers. Among other advantages over TradFi, this allows transactions to occur at any day or time, instead of being limited to traditional business hours.
Transactions executed using the JPM Coin have reached approximately $300 billion over the past 4 years. Impressively, JP Morgan handles daily payments amounting to about $9.8 trillion, showcasing the scale and significance of its payment processing operations.
Using blockchain opens up the opportunity for banks and other financial institutions to securely reduce transaction settlement times while also lowering the cost of that settlement, particularly in cross-border scenarios. Siemens has been moving quickly when it comes to experimenting with a variety of blockchain use cases. In February 2023, it used blockchain to fractionalize a 60M euro bond, the fractions of which were sold to other financial institutions in Germany, one of a handful of countries where some clarity exists (both actual and directional) on the cryptocurrency regulatory front (thus freeing organizations to start working with blockchain without becoming the target of regulatory enforcements).
By Elizabeth Morrison
Published:June 24, 2023