JPMorgan Foresees Increased Blockchain Use in Finance — Prepares to Offer Related Services

JPMorgan expects blockchain use in finance to increase as the crypto sector grows. The global investment bank says, “We want to make sure that we are able to not only support that but also be ready to provide related services.”

JPMorgan Chase & Co foresees increased blockchain usage in traditional finance and is getting ready to offer related services, Bloomberg reported Thursday.

The global investment bank has been using a blockchain for collateral settlements, allowing its clients to use a wider range of assets as collateral and trade outside of market operating hours. The first such transaction took place on May 20.

Ben Challice, JPMorgan’s global head of trading services, was quoted as saying:

What we’ve achieved is the friction-less transfer of collateral assets on an instantaneous basis.

In addition to derivatives trading, repo trading, and securities lending, JPMorgan said it plans to expand tokenized collaterals to include equities, fixed income, and other asset types.

Tyrone Lobban, head of JPMorgan’s Blockchain Launch and Onyx Digital Assets, explained that over time the bank’s blockchain could potentially be a bridge connecting institutional investors with decentralized finance (defi) platforms in the crypto economy.

He continued that as the crypto sector grows:

There will be a growing set of financial activities that happen on the public blockchain, so we want to make sure that we are able to not only support that but also be ready to provide related services.

In February, JP Morgan opened an “Onyx by J.P. Morgan” lounge in the metaverse. The bank estimated the metaverse to be “a trillion-dollar revenue opportunity across advertising, social commerce, digital events, hardware, and developer/creator monetization.”

JPMorgan CEO Jamie Dimon, while skeptical of bitcoin and crypto, is bullish about blockchain. He said in April: “Decentralized finance and blockchain are real, new technologies that can be deployed in both public and private fashion, permissioned or not.”

This week, JPMorgan’s strategists published a bullish report on bitcoin and cryptocurrency, stating that there is “significant upside” to the price of BTC. The bank has also replaced real estate with cryptocurrencies as its “preferred alternative asset class.”

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