JPMorgan Chase & Co.
JPMorgan Chase & Co. is a global financial services firm that focuses on investment banking, financial services for consumers, small business and commercial banking, financial transaction processing, asset management, and private equity. It is the largest bank in the U.S. according to Bankrate, a financial services information company. With a primary listing on the New York Stock Exchange, its common stock is also listed on the London and Tokyo stock exchanges.
Cryptocurrency and Blockchain
Forbes reported in March 2019 that JPMorgan was the only financial firm listed on the job-hunting site Indeed.com in the top ten companies posting jobs including the terms "blockchain," "cryptocurrency," or "bitcoin" over the past year. According to the Forbes story, the main competing firms were IBM, Cisco, Accenture, EY, KPMG, Microsoft, ConsenSys, Conduent, and Deloitte.
In September 2019, JPMorgan. sent out a note to their clients, saying that stablecoins such as Facebook's Libra are potentially prone to gridlock in periods of stress. According to JPM analysts led by Joshua Younger, this is because of the way stablecoins like Libra are currently designed; the note said that stablecoins lack certain microstructures - such as short-term liquidity facilities common in other payments systems - meaning the activity of the coins may grow faster than the coin can support.
In February 2019 JPMorgan announced that it had created its own cryptocurrency, JPM Coin, a digital token created to improve payment settlements between JPMC clients. This product will not likely be available for retail investors, so it cannot be traded like bitcoin, or similar digital assets. CNBC reported at the time of the announcement that testing for this product would begin "in a few months" from the announcement.
According to an October 27, 2020 report by CNBC, Takis Georgakopoulos, JPMorgan's global head of wholesale payments, said that one of the bank's large technology clients was using JPM Coin commercially for the first time, sending payments around the world. The bank also said that it had established a new business line called "Onyx" with a 100-person dedicated staff, which will let the bank commercialize its blockchain and digital currency developments.
Interbank Information Network
In April 2019, JPMorgan head of global clearing John Hunter said that the bank was "looking at the ability to do more at the point of settlement" with blockchain technology, specifically with the Interbank Information Network (IIN), a blockchain-based digital payments platform set up in partnership with the Australian bank ANZ bank and the Royal Bank of Canada in 2017. were 220 banks included in the IIN at that time. The IIN was useful in particular for correcting mistakes and errors in settlement instructions for interbnk transfers.
While reporting in September 2019 that Deutsche Bank, the world’s biggest clearer of euro denominated payments, had joined the IIN, JPMorgan noted that there were 310 banks signed up to use the service.
JPMorgan developed Quorum, a private blockchain written in Ethereum Go (Ethereum's programming language) but which does not run on the public Ethereum blockchain. Quorum was presented by JPMorgan at the annual Sibos conference in 2016. The platform was built in conjunction with EthLab and was made open source. In April 2018, the bank disclosed that it had run a successful debt issuance experiment using Quorum with National Bank of Canada. Other participants in the experiment were Goldman Sachs Asset Management, Pfizer Inc and Legg Mason Inc’s Western Asset as well as other investors in debt instrument.
Quorum is distinguished by several features including network and peer permissions management, enhanced transaction and contract privacy, voting-based consensus mechanisms, and higher transaction-processing performance. JPMorgan told Coindesk in May 2019 that it had developed an extension to a fully decentralized, cryptographic protocol. called Zether, for confidential payments that it is likely to use it with Quorum. Zether uses zero-knowledge proofs which allow one party to prove knowledge of some secret value or information without conveying any details about that secret.
According to the FAQ issued by JPMorgan when it first announced JPM Coin, its cryptocurrency will be issued on Quorum but be available on all other "standard Blockchains."
In a potentially transformative transaction for ConsenSys, the Ethereum-focused software development and consulting firm, the company announced on August 25, 2020 that it had acquired Quorum. The company said it would merge its existing protocol with Quorum, allowing it to choose the best of both protocols. The bank made an investment in ConsenSys of an undisclosed amount at the same time. The company said that JPMorgan will be a customer for the advanced features that are developed.
"Confirm" (blockchain banking software)
In April 2021, JPMorgan said the company was testing a new blockchain software product called "Confirm," which was designed to reduce the number of rejected or returned payments banks typically receive. According to JPMorgan's announcement, Confirm is meant to allow banks to request and receive confirmation of beneficiaries’ account information in near-real time. The announcement also said the company was testing this new product with twelve banks in Taiwan including CTBC Bank, Taiwan Cooperative Bank and First Commercial Bank.
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