The financial services behemoth is not new to crypto, but its latest deposit token could be a game-changer for blockchain-based payments globally.
Global financial services firm JP Morgan has a new offering backed by crypto. The company is reportedly deliberating on a deposit token for services like settlements and cross-border payments. The token, if approved by regulators, could be a milestone for blockchain-based payments.
According to the report, the firm has developed all necessary infrastructures for the token. Once it receives the required approvals, it could launch the token for its corporate clients. The deposit tokens would represent the deposits of the customers digitally.
Since the tokens could utilize blockchain technology, payments could be cheaper, instant, and made on blockchain rails.
“Deposit tokens bring plenty of potential benefits, but we also appreciate that regulators would want to be thoughtful and diligent before any new product gets developed and used. Should that appetite develop, our blockchain infrastructure would be able to support the launch of deposit tokens relatively quickly,” said a spokesperson of JP Morgan.
The new token announced by JP Morgan is not similar to its JPM Coin, except for a few aspects. The compliance mechanisms of both are the same. Transactions in both are required to go through anti-money laundering and KYC measures.
Earlier, the investment bank had tried using the deposit tokens as part of Project Guardian. The Monetary Authority of Singapore initiated the project. The current token project of JP Morgan could start with the USD and move to other fiat currencies later.