JPMorgan Moves JPM Coin to Coinbase Base in Tokenized Deposit Push

By
Ritu Lavania
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JPMorgan Moves JPM Coin to Coinbase Base in Tokenized Deposit Push

What To Know:

  • JPMorgan has launched its tokenised deposit product, JPM Coin (JPMD), on Coinbase’s Base network.
  • This marks the bank’s first move from a private blockchain to a public Ethereum layer-2 environment.
  • The move reflects rising client demand for on-chain banking tools and comes as global banks, including Standard Chartered, test tokenised deposits to stay competitive as stablecoins expand.

JPMorgan bank’s tokenised deposit product is live on Base, Coinbase’s Ethereum layer-2 network, signalling how far major financial institutions have moved toward on-chain finance.

JPMorgan Moves JPM Coin to Coinbase Base

The initiative centres on JPM Coin, known internally as JPMD, a blockchain-based representation of bank deposits. Unlike stablecoins, which are typically issued by non-bank entities and backed by reserves, JPMD represents a direct claim on funds held at JPMorgan. The structure allows deposits to function on-chain while remaining within the bank’s balance sheet, and in certain contexts, they can be interest-bearing.

This material has not been formally verified by any government officials and is based on Wu Blockchain, an independent investigator.

The move marks a notable shift in how large banks approach blockchain infrastructure. JPMorgan first launched blockchain deposit accounts in 2019 using a version of Ethereum, then called Onyx and now rebranded as Kinexys. That system was built for institutional clients operating within a closed network. The step onto Base introduces JPMorgan deposits to a public blockchain environment for the first time.

According to JPMorgan executives, the decision reflects growing client demand rather than a sudden strategic pivot. Basak Toprak, product head for deposit tokens at Kinexys Digital Payments, said customers are increasingly seeking ways to conduct payments and manage collateral directly on public chains using familiar banking instruments.

At present, stablecoins dominate on-chain cash usage, which, for many institutions, presents challenges. Stablecoins carry different regulatory and risk considerations, particularly for firms that are only starting to engage with digital assets. Traditional bank accounts, on the other hand, remain tied to operational cut-off times and offchain settlement constraints.

JPMD is seen as an alternative. On Base, it allows clients to move tokenised deposits around the clock while retaining exposure to a regulated banking product. The token is permissioned and transferable only among whitelisted participants that have completed JPMorgan’s onboarding process. The design reflects the bank’s intent to extend deposits into on-chain environments without opening them to unrestricted circulation.Market reaction to the launch was swift.

Observers noted that the move effectively links JPMorgan’s payments infrastructure, which processes trillions of dollars daily, to a major crypto exchange ecosystem. That connection has prompted speculation about broader implications for decentralised finance.

Toprak, however, has emphasised practical use cases rather than sweeping narratives. Payments, she said, remain payments regardless of the underlying rail.In traditional finance, cash already serves as collateral. Onchain systems introduce new settlement mechanics, but the economic function stays the same.

Client interest appears to support that view. JPMorgan has received inquiries from crypto-native firms, asset managers, and broker-dealers with exposure to Coinbase’s trading infrastructure. These firms often hold collateral on exchanges and settle margin obligations linked to crypto transactions. In many cases, those activities are currently handled through stablecoins or conventional bank transfers. Both approaches introduce trade-offs. Stablecoins can raise governance and counterparty concerns for institutional users. Offchain accounts remain bound by banking hours and settlement delays. Tokenised deposits offer a middle ground.

JPMD can be used to hold collateral or settle margin payments while operating continuously on-chain. For institutions managing crypto exposure alongside traditional assets, that combination reduces friction without requiring a full shift to stablecoin-based settlement.

There is also a competitive dimension.As stablecoins continue to expand, banks face the risk of losing relevance in digital settlement layers. Tokenised deposits allow banks to maintain a presence in on-chain markets while preserving their core role as deposit-taking institutions.Toprak said deposits remain the dominant form of money in the traditional financial system, and JPMorgan expects them to retain that role in blockchain-based environments. The bank’s approach prioritises controlled access and regulatory alignment rather than open issuance.

JPMorgan is not alone. Other global banks are testing similar models. Standard Chartered, for example, has launched a tokenised deposit solution for Ant International under Hong Kong’s regulatory framework. The initiative enables real-time treasury transfers using distributed ledger technology and highlights growing institutional interest beyond the US.