The past few weeks have been eventful in the cryptocurrency space; Paypal got involved in crypto as Bitcoin rallied past the $13k mark, and now JPM Coin — JPMorgan Chase’s in-house stablecoin has gone live and is now been adopted by major transnational tech companies to facilitate cross-border payment.
After about 18 months of rigorous testing and numerous tweaking behind the scenes, the largest US bank, JPMorgan Chase has taken the cryptocurrency industry by storm with the commercial launch of their stablecoin, JPM coin.
Relying on the information contained in the report, the potency of blockchain technology to increase financial transaction efficiency, reduce cost, and aid modern finance has chiefly contributed to the factors fueling the megabank’s interest in the technology. And of course, this technology will play a key role in increasing productivity and profitability of future banking.
JPMorgan’s Dedicated Blockchain Arm
To further their involvement in the industry, JP Morgan Chase has carved out a dedicated business unit called “Onyx.” Headed by CEO Umar Farooq, the unit will be responsible for all innovation related to digital currency and blockchain work. Takis Georgakopoulos, JPMorgan Chase’s global head of wholesale payments, commented that:
“We are shifting to a period of commercialization […] moving from research and development to something that can become a real business.”
JPMorgan has been overseeing a blockchain-based Interbank Information Network since 2017, which cuts across over 400 banks and corporations. The network which was renamed ‘Liink’ is believed to help banks and corporations cut down cost and increase savings for cross-border wholesale settlements.
Blockchain Increases Significant Cost-Savings On Cross-border Settlement
Leveraging on the significant amount of money transacted through JPMorgan Chase for cross-border wholesale settlements which is in the scale of over $6 trillion per day, Liink will help the company in generating significant cost-savings. Georgakopoulos said that a new blockchain system is only months from commercial launch:
“Using a version of blockchain with the participants being the main issuers of checks and the main operators of lockboxes, it’s possible we can save 75% of the total cost for the industry today, and make checks available in a matter of minutes as opposed to days.”
JPMorgan has expressed confidence in blockchain technology as the adoption of Central Bank Digital Currency (CBDC) drums harder in various countries such as China, France, Canada and Singapore. This is a pointer to the creation of new payment rails for the global payment network and to facilitate an efficient e-commerce market.