TL;DR
- JPMorgan will launch an instant currency settlement service between the dollar and the euro using its Kinexys blockchain.
- The platform will use the JPM Coin token, processing over $2 billion in transactions daily.
- This system is expected to become profitable in three to five years.
JPMorgan Chase has announced the upcoming launch of an innovative instant conversion service between the euro and the dollar through its Kinexys blockchain platform.
This technology will allow transactions between these two currencies to be settled almost immediately, a significant advance over traditional methods, which usually take one or two days.
The information comes from a Bloomberg article published on November 6, 2024, which details the characteristics of this new proposal from the banking entity.
The system that JPMorgan will implement on Kinexys will use its native token, the JPM Coin, a digital currency that is crucial to the operation of the network.
This token has proven to be efficient in processing large transaction volumes, as Kinexys currently handles over $2 billion in daily transactions.
The idea of using this digital currency not only seeks to facilitate currency conversions, but also to generate additional income through currency margins and transaction fees.
This move is aimed at improving the efficiency of international payments, especially for fintech companies that rely on fast, low-cost payments.
Furthermore, the service is expected to be expanded to include more currencies in the future, such as the British Pound, which will make the platform even more attractive to a larger number of international customers.
According to JPMorgan executives, such real-time payment solutions could revolutionize the financial sector by offering a more agile alternative to traditional currency settlement systems.
Expanding the use of blockchain and its implications
JPMorgan Payments Global CEO Umar Farooq noted that Kinexys growth has been significant, with transaction volumes increasing tenfold in just one year.
This growth is expected to continue, and the platform has the potential to further increase its capacity.
However, Farooq also warned that reaching full profitability could take three to five years, given that costs must be balanced against revenue generated from transaction fees and foreign exchange margins.
The use of JPM Coin is essential for the platform to maintain liquidity and efficiently process transactions.
As the platform continues to scale, this token is expected to not only facilitate currency exchange but also open up new revenue streams, especially through foreign exchange margins.
This shows how JPMorgan is using blockchain technology not only as a tool for innovation, but also as a driver of long-term growth and profitability.
JPMorgan, under the leadership of CEO Jamie Dimon, has established itself as one of the leading implementers of blockchain in the banking sector.
The bank’s adoption of this technology reflects its commitment to the future of digital finance and its ability to offer innovative solutions on a global level.
Undoubtedly, the advancement of instant currency settlement could be a major step towards transforming the international payments landscape, facilitating faster, cheaper and safer transactions.