JPMorgan Coin May Become a Consumer Product, CEO Says
Investment banking giant JPMorgan’s much hyped JPM Coin, the centralized digital token, may become something of interest for the broader audience, the bank’s CEO Jamie Dimon suggested during an annual investor day on Tuesday.
“JP Morgan Coin could be internal, could be commercial, it could one day be consumer,” Dimon said during a question-and-answer session at the event, according to CNBC.
Originally, JPM Coin was created by the financial giant to instantly settle payments between institutional clients. As reported, the new coin will at first be used with a small number of JPMorgan’s institutional clients, and the bank further says that they “don’t have plans to make this available to individuals at this stage.”
However, the bank also writes on its website that “cost-savings and efficiency benefits would extend to the end customers of our institutional clients,” while they also hold the door open to potentially allowing individuals to use the coin directly at some point in the future.
Umar Farooq, head of Digital Treasury Services and Blockchain at the bank, previously admitted that the JPM Coin isn’t money per se - it is a digital coin representing United States Dollars held in designated accounts at JPMorgan Chase N.A. According to Farooq, there are three early applications for the JPM Coin:
- International payments for large corporate clients, which now typically happens using wire transfers between financial institutions on decades-old networks like Swift.
- Securities transactions.
- The final use for JPM Coin would be for huge corporations who use JPMorgan's treasury services business to replace the dollars they hold in subsidiaries across the world.
He also said that the coin could also be used for payments on internet-connected devices if that use for blockchain catches on.
Many in the crypto community have speculated on what is JPMorgan’s, whose CEO in 2017 made headlines for calling Bitcoin “a fraud” and “worse than tulip bulbs,” real motivation is for creating a digital token on its own. The popular crypto YouTuber BoxMining (Michael Gu) for example claimed that JPMorgan’s entry into crypto is nothing more than an “old centralized cartel trying to stay alive in an ever-decentralizing world.”
Meanwhile, Ripple’s CEO Brad Garlinghouse had his own take saying: “As predicted, banks are changing their tune on crypto. But this JPM project misses the point – introducing a closed network today is like launching AOL after Netscape’s IPO. 2 years later, and bank coins still aren’t the answer.”