JP Morgan‘s Cryptocurrency to Begin Customer Testing This Year
An interview with JPMorgan’s head of digital treasury services and blockchain Umar Farooq has revealed that the financial giant is getting ready to test out their JPM Coin with clients, as per a report from Bloomberg Japan, June 25, 2019.
As per the report, Umar Farook disclosed that JPM Coin, the firm’s dollar-backed stablecoin, is going to be put to the test with “several clients”. The coin was originally announced in February 2019 and is designed to instantly settle transactions such as inter-company remittances, bonds and commodity transactions on a blockchain platform. Though Farook didn’t disclose the names of said clients, he noted that customers in Japan, Europe, and the United States have expressed interest in the project.
Farook stated in the interview:
“We believe that a lot of securities over time, in five to 20 years, will increasingly become digital or get tokenized,”
Blockchain technology in the financial sector, and more specifically banking, has proven to be a resounding success story for the crypto industry as a whole. Naturally, JPMorgan’s project received early criticism as CEO Jamie Dimon had once referred to Bitcoin as a “fraud”, an opinion that was quickly retracted.
Though there is plenty of contention surrounding JPM Coin, the decision to have it built as a dollar-backed stablecoin has received praise. As opposed to Ripple (XRP), it avoids market fluctuations that could cause a loss during a transaction and will likely be adopted by far larger firms; that said, as of January 2019, Ripple has signed up over 200 clients to its payments platform.
Farook described that the project’s development “on the technical side” was going well. Interestingly, the JPM Coin will run on top of JP Morgan’s very own enterprise blockchain platform Quorum which was built on the Ethereum blockchain in partnership with Microsoft.
Discussing where the project goes from here, Farook added that testing will likely begin toward the end of the year, granted that the project meets regulatory standards.
“The technology is very good, but it takes time in terms of licensing and approval. As long as you are a bank, you must make sure that it does not violate the regulations of all the countries or regions where you operate in.”