J.P. Morgan announced its Kinexys platform is piloting the issuance of JPMD, a USD deposit token on Base, the Ethereum Layer 2 blockchain built within Coinbase, eventually providing institutional clients with an alternative to stablecoins for near-instant 24/7 settlement and near real-time liquidity.
JPMD is a permissioned deposit token and will eventually enable J.P. Morgan’s institutional clients exclusively to send and receive money securely on-chain, enhancing the digital payments ecosystem and encouraging broader adoption.
To date, stablecoins have been the primary option for on-chain native digital payments on public blockchains, serving as a form of cash and facilitating transactions. Digital assets offer 24/7 settlement and real-time liquidity, and the JPMD proof of concept, a deposit token on Base, offers these advantages by integrating with traditional banking systems and providing the ability to pay interest to holders. JPMD will be a permissioned token, eventually available exclusively to J.P. Morgan institutional clients.
By bringing commercial bank deposits onto Base, JPMD will enhance digital payments for institutions by making it faster and easier to move money. This marks the first time Kinexys is leveraging a public blockchain and will help accelerate the adoption of digital assets by appealing to both traditional and digitally native institutions.
Jesse Pollak, creator of Base and VP of Engineering at Coinbase, said in a statement: “Base offers sub-second, sub-cent, 24/7 settlement, which makes fund transfers between J.P. Morgan institutional clients nearly instant. Coinbase is a proud J.P. Morgan institutional client, and this pilot combines the credibility of both J.P. Morgan and Base to help bring institutional money into a more global economy.”
JPMD is intended to support near real-time peer-to-peer transfers between wallets on Base, providing institutional clients with the flexibility to transfer funds securely and efficiently with minimal delay. By reducing friction, clients will be able to enhance operational efficiency and support real-time financial decision-making.
Lauren Abendschein, VP of Institutional Sales at Coinbase, said in a statement: “Moving money on-chain takes seconds, rather than days, and we’re glad to see institutions like J.P. Morgan support digital assets for their clients.”
Naveen Mallela, global co-head of Kinexys by J.P. Morgan, said in a statement: “With the launch of JPMD, we are now bringing yield-bearing commercial bank money onto Base, one of the leading public blockchains. For institutional clients, JPMD combines the benefits of traditional banking with the innovation of blockchain technology—offering deposits backed by the bank’s balance sheet and settlement capabilities, with transactions executed 24/7 in near real-time on Base.”