Central bank digital currencies (CBDCs) will hit the market sooner or later. While many people expect digital fiat currencies, initiatives like JPM Coin are a bit different. A recent test by the Central Bank of Bahrain shows the currency has merit for payments and deposits, although in a limited capacity.
JPM Coin Makes An Impact
When banks begin building their own digital currencies, things can quickly go from bad to worse. But, at the same time, there is something to be said for currencies such as JPM Coin. The digital currency of JPMorgan Chase & Co. can be beneficial when foreign banks deal with this institution in some capacity.
A recent test conducted by the Central Bank of Bahrain confirms this digital currency can be useful. Through JPM Coin, US Dollars held on deposit with JPMorgan Chase &Co. can be easily transferred to the bank’s accounts. More importantly, the transactions occur in real-time, enabling far smoother and cheaper transactions than traditional means.
Central Bank of Bahrain Governor Rasheed Ali Maraj adds:
“Through our work with ALBA, Bank ABC, and Onyx by JP Morgan, we aspire to address and eliminate the inefficiencies and pain points which exist today in the traditional cross-border payments arena.”
The JPM Coin initiative kicked off in 2019 to enable instant settlement of transactions between wholesale payments business clients. After a few years of tests and small-scale experiments, JPM Coin began available for commercial use in 2021. The test with the Central Bank of Bahrain yielded significant data to further develop and enhance the digital currency.