JP Morgan is responding to the growing interest in stablecoins by introducing its own rival token, named JPMD.
The US banking giant announced plans to launch a deposit token on Coinbase’s public blockchain, Base, which operates on the Ethereum network. This deposit token is designed to serve as a digital representation of a commercial bank deposit.
The new yield-bearing token will feature round-the-clock settlement and will be available exclusively to the bank’s commercial clients.
Naveen Mallela, global co-head of Kinexys, JPMorgan’s blockchain unit, stated, “We see institutions using JPMD for on-chain digital asset settlement solutions as well as for cross-border business-to-business transactions. Since deposit tokens will also be interest-bearing, they will offer better fungibility with existing deposit products that institutions utilize.”
The bank notes that, while its token may share some attributes with a stablecoin, it is fundamentally a different product, aimed at providing institutions with closer ties to the banking system.
In May, the Wall Street Journal reported that JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo have engaged in discussions about potentially launching a stablecoin to enhance transaction speeds and address competition from emerging crypto firms.
This initiative comes in light of recent US regulatory actions regarding stablecoin regulation, with the Senate today voting in favor of the Guiding and Establishing National Innovation for Stablecoin Act (GENIUS Act).