This is not JP Morgan’s first blockchain rodeo. JP Morgan launched an Interbank Information Network (IIN) for cross border payments. 176 banks world wide have joined IIN since 2017.
IIN is designed to transfer information.
JPM coin is designed to instantly transfer value.
Initially it will only be accessible to wholesale customers of JP Morgan. Unlike other stable coins JPM coin is a permissioned private blockchain.
“Pretty much every big corporation is our client, and most of the major banks in the world are, too,” — Umar Farooq, Head of Blockchain Initiatives, JP Morgan
Blockchain will lead to faster settlement times for payments between institutional customers.
This project is huge because:
The three use cases for the new coin initially are
The forex risk for companies like Western Union could be eliminated. If you send money via Western Union today your money is available within minutes. It can take up to a day for Western Union’s internal wire transfer to clear. The volatility of the forex rate has to be priced into the fees.
It’s early days but very exciting for the industry, except for Ripple.
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