The success of JPM Coin, JP Morgan's cryptocurrency that processes $1 billion a day in transactions

A few days ago, JP Morgan's global director of payments, Takis Georgakopoulos, announced that the bank already processes more than $1 billion a day in transactions made through its digital asset JPM Coin.

After its development during 2019, the official launch of the JP Morgan token took place on October 21, 2020 and in June 2023 they announced that transactions worth more than 300 million dollars had already been made. This Stablecoin is backed by a 1:1 ratio with the U.S. dollar, backed by JP Morgan's reserves. Today, its use is reserved for institutional clients for wholesale payments and real-time interbank transactions, with JP Morgan's objective being to develop a similar token for use in retail banking.

According to Takis Georgakopoulos, JPM Coin has been developed to solve the three major deficiencies existing in current traditional payment systems:

- The lack of speed in money transfers, especially in international operations

- The separation between the movement of money and information, which results in a lack of transparency and makes it difficult to track and reconcile transactions

- The fungibility of money.

In addition to solving these deficiencies, we must add security, trust, programmability and no need for intermediaries, which translates into a reduction in cost.

Technical operation

La Stablecoin has been developed on JP Morgan's private blockchain called Quorum. This private network has been built using Hyperledger Besu software. The main advantage of this software and therefore of the Quorum network is the compatibility with the Ethereum Virtual Machine (EVM) and with Solidity (language of the Ethereum network), thus being able to offer support for advanced Smart contracts and all the possibilities that this entails.

As it is compatible with EVM, the Quorum private network has the possibility of issuing ERC-20, ERC-721 and ERC-1155 tokens. More specifically, JPM Coin is a type token. ERC-20 which works in a similar way to others Stablecoins such as USDT.

Today, large corporations have used the Quorum private network, such as the National Bank of Canada, Goldman Sachs Asset Management, Pfizer, Genentech or Microsoft Azure. The Quorum network has improved the security, efficiency, and speed of financial transactions.

Interoperability

The existence of bridges controlled by JP Morgan allows transactions and settlements to be carried out with other banks through traditional systems or through different blockchain networks. An important example is that, through the chainlink CCIP protocol, the JPM Coin token can be transferred through the bank messaging system SWIFT, the most used international banking network. This evolution of the financial system, which seeks to interconnect blockchain networks with their infrastructure, is analyzed in This article.

In short, the significant and continuous increase in the number of interbank transactions by corporate customers demonstrates the efficiency and adoption of the JPM Coin token and the Quorum private network. This technology provides these transactions with greater security, transparency, trust and speed compared to the traditional banking system. In addition, the elimination of intermediaries leads to a reduction in costs and settlement times, making this technology more attractive to JP Morgan's corporate clients.