JPMorgan Launches JPMD Deposit Token Pilot on Base Network
JPMorgan Chase has initiated a pilot program for its JPMD deposit token on the Base network, a layer-2 blockchain developed by Coinbase. This strategic move highlights the bank’s commitment to integrating traditional finance with blockchain innovation.
Pilot Program Overview
Naveen Mallela, an executive at JPMorgan’s blockchain division Kinexys, confirmed the pilot. A fixed amount of JPMD tokens will be transferred to Coinbase via the Base network. Transactions will initially use US dollars, with additional currencies planned after regulatory approval.
Advantages of Deposit Tokens
Unlike stablecoins, deposit tokens represent dollar deposits held in bank accounts. Mallela emphasized their benefits, including greater scalability and potential interest payments, making them an attractive alternative for institutional use.
Future Implications
Following the pilot, Coinbase’s institutional clients will access JPMD for transactions. This development comes as yield-bearing stablecoins emerge as potential disruptors to traditional banking models.
Key Details
- JPMorgan testing JPMD token on Coinbase’s Base network
- Initial transactions in USD, expanding to other currencies later
- Deposit tokens offer scalability and interest potential
- Program marks significant banking-blockchain integration
