This week, JPM Coin will be used commercially by a major technology client to send payments worldwide
After years of development, the U.S. bank JPMorgan has announced the launch of its stablecoin and blockchain protocol. The bank’s chief executive officer, Jamie Dimon, who has been openly critical of Bitcoin in the past and generally skeptical of the broader cryptocurrency market, oversaw the project’s development.
The bank’s global head of wholesale payments, Takis Georgakopoulos, confirmed that JPM Coin will be used commercially for the first time this week by a large technology client to facilitate cross-border payments.
JPMorgan also created a dedicated business vertical for blockchain and digital currency research called Onyx. The interbank group that will test and interact on the Onyx network has been renamed “Liink.” Some observers in the crypto space have noted parallels between the name Liink and the blockchain project Chainlink.
“We are launching Onyx because we believe we are moving into a period of commercialization for these technologies, shifting from research and development to something that can become a real business,” Georgakopoulos said.
JPMorgan is one of the world’s largest cross-border payments providers, moving roughly $6 trillion every day across more than 100 countries. Today’s system relies on a complex network of correspondent banks around the globe, and payments can be rejected because of account information errors or other issues.
The Onyx network and JPM Coins aim to address these problems and streamline the process, with a particular focus on solving issues related to wholesale payments.
Onyx CEO Umar Farooq highlighted how banks could save millions of dollars by charging a few cents to verify data for each transaction, reducing the costs associated with fixing errors and creating a revenue model for participants in the network.
JPMorgan is also exploring the creation of new, separate payment rails for central banks that are considering developing their own digital currencies. Georgakopoulos pointed to China and Singapore as examples of jurisdictions evaluating central bank digital currencies.
The head of Onyx also explained that the bank waited for the right moment to announce this development.
“If you think about blockchain, we are somewhere in the ‘Trough of Disillusionment’ or just past the hype curve. That is why at JPMorgan we have been relatively quiet until we were ready to scale and commercialize it,” Farooq said.