The U.S. bank will regulate the JPM coin to avoid value fluctuation, ensuring a 1:1 dollar exchange as it strives to capture the growing mainstream crypto audience

While cryptocurrency is becoming more mainstream, there are still some impediments to full mass adoption. The backing of a major bank, for one, would go far towards lending the coins more credibility. With that in mind and hoping to capture converts, JP Morgan has become the first major American bank to create its own crypotcurrency, called the JPM coin.

There will be a simple exchange rate of one coin per one dollar—this prevents the volatility that can scare more conservative customers off bitcoin. Once the client uses the coins, the payment is registered on blockchain and the client is given back their applicable “change.” The coin will have three main uses: It will act as a means for corporate clients to make international payments, for securities transactions and lastly for large corporations to replace dollars held in subsidiaries.

Umar Farooq, head of J.P. Morgan’s blockchain projects, explains that the potential for more future uses is high: “The applications are frankly quite endless; anything where you have a distributed ledger which involves corporations or institutions can use this.” While major banks, including JP Morgan, have been critical of bitcoin, this non-fluctuating currency serves both the bank and its customers. By being the first major bank to create a coin, JPM hopes to stay ahead of the rest of the field.

JP Morgan


Lead image: stock photos from Bumble Dee/Shutterstock

While cryptocurrency is becoming more mainstream, there are still some impediments to full mass adoption. The backing of a major bank, for one, would go far towards lending the coins more credibility. With that in mind and hoping to capture converts, JP Morgan has become the first major American bank to create its own crypotcurrency, called the JPM coin.

There will be a simple exchange rate of one coin per one dollar—this prevents the volatility that can scare more conservative customers off bitcoin. Once the client uses the coins, the payment is registered on blockchain and the client is given back their applicable “change.” The coin will have three main uses: It will act as a means for corporate clients to make international payments, for securities transactions and lastly for large corporations to replace dollars held in subsidiaries.