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JPMorgan Chase finally concretizes its crypto ambition by launching JPMD. After submitting the request for the brand at the beginning of the week, the bank will start its “deposit token” on the basis of Coinbase. How does this token work and what challenges are hiding behind this strategic choice?
In short
- JPMorgan launches its token JPMD on the basic blockchain dedicated to approved institutions.
- Unlike stablecoins, JPMD remains in the classic banking system.
- The bank promises better scalability, potential interest and increased regulatory security.
JPMORGAN revolutionizes the funds with its token JPMD at the base
JPMORG officially launches its pilot project JPMD on Blockchain Base de Coinbase.
NAVEEN MALLALLA, head of the Kinexys Blockchain division, announced that Bloomberg Bloomberg immediately transfer tokens to the stock market platform. This confirmation is governed by the mysterious deposit of the brand “JPMD” of June 15.
The basic choice as technical support is strategic. This layer of 2 blockchain, built on Ethereum, really dominates the scalability solution. In one year, its total locked value (TVL) has more than doubled, which is a sign of growing trust inspired in the ecosystem.
First, JPMD transactions will be marked in dollars. However, other currencies could be integrated, subject to the upcoming regulatory verification.
The great new JPMD lies in its hybrid nature. Unlike conventional stablecoins, which are often supported by external liquidity reserves, JPMD integrates directly into the banking system.
It represents real bearings in dollars detained in JPMORGAN, which offers an unprecedented connection between traditional financing and blockchain.
JPMD deposit reflects the growing JPMORGANA obligation to blockchain innovation. This initiative illustrates the wider acceptance of Kryptos Wall Street while large institutions explore stablecoins and ETF.
Ryan Lee, Bitget Research analyst
The test phase should take several months before the opening of institutional customers Coinbase. Progressive approach, faithful strategic caution of banking giant.
Claimed superiority in the face of stablecoins
According to Naveen Mallel, responsible for Kinexys, the tokens would be a deposit for financial institutions “alternative superior stablecoins”.
Behind this statement, it hides a strategic position that JPMORGan intends to clarify: digital assets anchored in a banking system aimed at satisfying the cash needs of large companies and institutions.
Unlike stablecoins that require 100 % warranty according to reserves in trust or ministries (such as USDC or USDT), deposit tokens accept a fractional reserves similar to that traditional banks practical for their deposits.
This mechanism potentially allows greater flexibility of use, better circulation of capital and lower emission costs. This means that this structure also includes an increased exposure to the risks of liquidity in case of massive download or loss of trust.
One of the assets submitted by JPMORGan remains the possibility that JPMD generates interests. If the bank implements this option, the token will distinguish from traditional stablecoins, most of which do not pay their holders. This characteristic would make it a more attractive tool for managing cash for large companies and funds.
In this context, deposit tokens do not necessarily focus on replacing stablecoins, but to offer regulated, banking and potentially a more profitable alternative, especially in the institutional environment where compliance and stability are submitted.
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Passionate Bitcoin, I like to explore meanders blockchain and cryptos and share my discoveries with the community. My dream is to live in a world where privacy and financial freedom is guaranteed for everyone, and I firmly believe that Bitcoin is a tool that can make it possible.
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The words and opinions expressed in this article are involved only by their author and should not be considered investment counseling. Do your own research before any investment decision.
