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Banks Have Attempted To Eliminate Cryptocurrency, They Are Now Adopting It


For large clients such as hedge funds, Goldman has begun publishing the prices of digital assets on its main platform, anticipating a time when banks will be turning to cryptocurrencies. It’s possible that it’ll be able to support trade.


JP Morgan’s Onyx, a dollar-backed digital currency that works on Quorum, an internal technology that replicates the structure of the blockchain, was launched in 2019. However, unlike bitcoin’s blockchain, which is decentralised, the bank controls the quorum. A quorum was recently transformed into a software start-up.

JPMorgan has launched an all-digital system that resembles the old “overnight repo” market, in which banks trade short-term US government debt instruments for cash. These transactions often take more than a day to complete – hence the term “overnight” – but JPMorgan’s platform can execute them in as little as 15 minutes, reducing risk. So yet, it has only three users, two of which are JPMorgan’s own firms. This year, Goldman Sachs became the first outside participant. JPMorgan may control one of the world’s most important short-term funding markets if other banks join.


JPMorgan is one of the few major banks whose experiments with blockchain – the technology that underpins digital currency transactions – have positioned them up to profit in the future from the systems they are testing today, according to cryptocurrency specialist Igor Pejic. Because, as he put it,“they’re setting up an infrastructure that they ultimately control.”

Regulators began contacting immediately after JPM Coin went up, according to a source familiar with the situation who was not authorised to speak publicly. They were afraid that the movement of coins around the financial system, which were related to the dollar, may lead to a build-up of risk, triggering panic and a 21st-century version of bank running. JPM Coin usage had to be limited by the bank.

JPM Coin can no longer be used to send money outside of JPMorgan’s internal systems. Customers of banks can use it to transfer cash and other assets almost instantly within the bank, but it has no meaning outside of the bank.

Small banks attempting to establish a bitcoin business have also caught the attention of regulators. In 2018, the top US banking regulator, the Office of the Comptroller of the Currency, received feedback on Quantic Bank’s plans to establish a debit card programme that rewards consumers. Quantic Bank is situated in New York and has only $1 billion in assets. in the cryptocurrency bitcoin