American banking giant JPMorgan Chase & Co. has reached a major milestone in blockchain adoption with its digital token JPM Coin, which now handles daily transactions worth more than $1 billion, according to its global head of payments, Takis Georgakopoulos.
This success, discussed by the company in the recent Bloomberg report, highlights growth and confidence in the use of JPM Coin for financial transactions, which are carried out mainly in US dollars.
But what is most intriguing is JPMorgan’s intention to further expand the utility of this digital currency, as Georgakopoulos mentioned in a recent interview on Bloomberg TV.
JPM Coin, a form of settlement token, offers JPMorgan wholesale clients the ability to make wholesale payments denominated in dollars and euros over a private blockchain network.
This versatility in supported currencies provides flexibility to users and signals greater adaptation to the needs of the global financial market.
However, it is important to note that while JPM Coin handles an impressive $1 billion per day, this is still a small fraction of the staggering $10 billion in daily US dollar transactions processed by JPMorgan as a whole.
This contrast illustrates the immense magnitude of the bank’s financial operations, in relation to its foray into the world of cryptocurrencies and blockchain for the moment.
JPMorgan Exploring Beyond JPM Coin
They cite as examples of the company’s exploration in blockchain matters; a blockchain-based repository application and digital deposit token designed to streamline cross-border settlements.
According to the firm, there is potential to bring the efficiency of blockchain to a broader audience, as Georgakopoulos mentioned:
“The next step in this journey is to think about how you can create a more consumer-oriented version, to bring that efficiency to consumers.”
While blockchains may appear to offer instant payments and lower costs compared to current technologies, it’s essential to note that we haven’t yet tested blockchains on the same scale as existing payment networks.
Relevant questions arise regarding how a currency like JPM Coin, limited to a single bank’s clients and centralized, can coexist with the principles of decentralization and privacy that characterize most cryptocurrencies.
Considering data privacy and security in a system controlled by a financial institution, also presents challenges to the core principles of individual empowerment and control crucial in the broader crypto context.
These issues underscore the importance of critically analyzing the direction of specific financial innovations and stress the significance of striking a balance between blockchain technology and traditional financial institutions.