JPMorgan got hearts racing on Valentine’s Day, when it announced that it will be the first American bank to roll out its own digital coin.
The coin, which will be 1:1 redeemable to fiat currency held by JPM, will be issued on Quorum – JPMorgan’s own blockchain platform – and will eventually be rolled out to others, says Umar Farooq, head of digital treasury services and blockchain at JPMorgan, on the bank’s website.
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| Umar Farooq, JPM |
“When one client sends money to another over the blockchain, JPM Coins are transferred and instantaneously redeemed for the equivalent amount of US dollars, reducing the typical settlement time,” he says. Still in testing phase, full details on how the coin will function are still being worked out, but it hasn’t stopped bankers speculating on its impact – especially given previous comments made by the bank’s CEO, Jamie Dimon, where he called cryptocurrencies a “fraud” and a “scam” and said that if any of his employees were caught trading bitcoin they would be fired.
But as one transaction banker based in the US says, “dig a bit deeper and there is clearly a difference between a cryptocurrency and the JPM Coin.