On Nov. 12, JPMorgan crossed a line that the rest of the banking sector has been tiptoeing around for years: it put real institutional dollars onto Base, an Ethereum Layer 2 network developed by Coinbase.
It took this step with a new type of digital asset, called a deposit token, because it is not necessarily fully-backed like more common stablecoins. The bank dubbed this asset JPM Coin (JPMD), and early transactions with clients like B2C2, Coinbase, and Mastercard show how quickly funds can now settle in tokenized form, with transfers completing in seconds instead of days.
What makes this launch particularly significant is not just that it runs on a public chain, but that JPMorgan is framing JPMD as a superior alternative to stablecoins for institutional use.
In response to Unchained’s questions about JPMD, a spokesperson from Kinexys by J.P. Morgan said, “Institutional clients can treat JPM Coin as bank deposits on their balance sheet, providing certainty around financial and accounting treatment….JPM Coin is [also] integrated with J.P. Morgan’s traditional banking systems, thereby reducing liquidity silos for clients…For these reasons we believe that deposit tokens are a more compelling product offering for institutional clients than stablecoins.”
This move comes as stablecoin wars are heating up inside the U.S. and around the world. Tether, the firm behind the $185 billion stablecoin that has made over $10 billion in profit so far this year, is launching a U.S.-compliant token led by Bo Hines, currently the CEO of Tether USA₮ and the former executive director of the White House Crypto Council. Circle, a U.S. company behind the $75 billion stablecoin known as USDC, is launching its own blockchain known as Arc along with a wave of institutional partnerships. And finally, global payments firm Stripe launched its own payments-focused blockchain called Tempo.
But in terms of pure size, JPM blows them out of the water. As of Dec. 31, 2024, the bank had $4.0 trillion in total assets and $2.4 trillion in deposits. Jaime Dimon’s 2024 Chairman and CEO letter to JPM shareholders boasts of moving over $10 trillion in traditional payments flows in more than 160 countries per day. With its huge customer base, the bank’s position that deposit tokens are much more capital efficient than stablecoins, and can even pay interest, will likely carry a lot of weight with its institutional customers.
It even has a secret weapon: a crypto-friendly regulatory setup that gives it advantages over both stablecoins and fellow banks.
Stablecoins have won some big battles in Washington, D.C., recently with the passage of the GENIUS Act, but are JPMorgan and deposit tokens going to win the war over digital payments?
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