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JP Morgan, one of the most renowned names in the financial circles has recently launched its digital currency called JPM coin. The project was completed in tandem with the trial by a large technology firm which helped it deliver.
The pilot project for the vision was launched about two years ago and received good participation from about 400 banks including the Monetary Authority of Singapore. JPM client has been helmed as an ambitious project that will be used to ease off hassles related to cross-border payments.
JPMorgan head of wholesale payments, Takis Georgakopoulos confirmed the news of the launch.
“At JPMorgan Chase, the firm’s digital currency JPM Coin is being used commercially for the first time this week by a large technology client to send payments around the world.”
He also added that the JPM coin is a versatile option amongst digital currencies as its use-cases are endless. But, despite that JP Morgan is currently focussing on three early applications for the digital currency. The first application that it intends to use it for is to eliminate all the hassles and pain points with respect to cross-border payments. At present the methods followed by the bank are largely loss making because it is dependent on an inefficient and highly complex network of correspondent banks. The bank which processes about $6 Trillion worth of transfers in a day faces high rejection rates due to many reasons and all it does is pile up costs making it a highly inefficient but important task.
“If banks could confirm that payments have the proper account information and regulatory format before they are sent, they could prevent expensive rejections.”
The second application of the digital currency is the processing of paper checks. The manual processing of physical paper checks is taxing on the entire system. Hundreds of millions of checks get processed everyday and the processing is completely manual. The scope for erring also is on the higher side because human errors are factored in. But things can get hugely simplified when blockchain technology is put to use for this process.
Another application of the JPM Coin is in the processing of paper checks. With hundreds of millions of checks getting sent each day, processing them could be manually and financially intensive. Processing could be radically simplified by utilizing blockchain technology.
“Using a version of blockchain with the participants being the main issuers of checks and the main operators of lockboxes, it’s possible we can save 75% of the total cost for the industry today, and make checks available in a matter of minutes as opposed to days.”
JP Morgan is showing a lot of interest in exploring Blockchain technology and its uses. It has decided to invest in resources into creating Onyx, a new business division plainly research-focused. It will dedicate its resources into looking for real-world applications for blockchain and cryptocurrency initiatives and how these technologies can be brought into the real world for mainstream use and commercialisation.
Source: Twitter