While the cryptocurrency craze may have died down a bit, J.P. Morgan Chase is betting big on the digital asset by creating the first cryptocurrency by a major US bank, CNBC reports.

The financial service company will begin with a trial period in the next few months, moving a portion of its $6 trillion daily lending by JPM Coin. This digital token will serve to instantly settle payments between clients.

In order to utilize the blockchain database technology, J.P. Morgan will use JPM Coin to transfer money much faster, as opposed to older, slower means, such as wire transfer.

"So anything that currently exists in the world, as that moves onto the blockchain, this would be the payment leg for that transaction," said Umar Farooq, head of J.P. Morgan's blockchain projects. "The applications are frankly quite endless; anything where you have a distributed ledger which involves corporations or institutions can use this."

Furthermore, J.P. Morgan's JPM Coin will account for one of the first real-world applications for a cryptocurrency in banking, as most institutions insist such a digital asset is too risky. JPM Coin will also function differently than other cryptocurrencies like bitcoin, with large corporations such as banks and broker dealers seemingly being the only ones capable of using the tokens.

CNBC goes on to point out that each JMP Coin is redeemable for one US dollar, meaning its value should not fluctuate. Once a client deposits money at the bank, they will receive the coins to use as payment or security purchase on the blockchain. After they are spent, the coins are destroyed by the bank.

To begin, JMP Coin will be used for international payments for large corporate clients, securities transactions, and corporations that utilize J.P Morgan's treasury services business, replacing dollars held in subsidiaries.

For more on J.P. Morgan's cryptocurrency, follow on over to CNBC.

What To Read Next

*If you submitted your e-mail address and placed an order, we may use your e-mail address to inform you regularly about similar products without prior explicit consent. You can object to the use of your e-mail address for this purpose at any time without incurring any costs other than the transmission costs according to the basic tariffs. Each newsletter contains an unsubscribe link. Alternatively, you can object to receiving the newsletter at any time by sending an e-mail to info@highsnobiety.com

Web Accessibility Statement

Titelmedia (Highsnobiety), is committed to facilitating and improving the accessibility and usability of its Website, www.highsnobiety.com. Titelmedia strives to ensure that its Website services and content are accessible to persons with disabilities including users of screen reader technology. To accomplish this, Titelmedia has engaged UsableNet Inc, a leading web accessibility consultant to help test, remediate and maintain our Website in-line with the Web Content Accessibility Guidelines (WCAG), which also bring the Website into conformance with the Americans with Disabilities Act of 1990.

Disclaimer

Please be aware that our efforts to maintain accessibility and usability are ongoing. While we strive to make the Website as accessible as possible some issues can be encountered by different assistive technology as the range of assistive technology is wide and varied.

Contact Us

If, at any time, you have specific questions or concerns about the accessibility of any particular webpage on this Website, please contact us at accessibility@highsnobiety.com, +49 (0)30 235 908 500. If you do encounter an accessibility issue, please be sure to specify the web page and nature of the issue in your email and/or phone call, and we will make all reasonable efforts to make that page or the information contained therein accessible for you.