JPMorgan Chase & Co. is set to launch instant foreign exchange (FX) settlements for dollar-euro transactions through its Kinexys blockchain platform, according to Bloomberg.
Kinexys, originally known as Onyx, was introduced in 2020 to facilitate digital payments via JPM Coin, a tokenized deposit token native to the blockchain. The platform reportedly now processes $2 billion daily.
The bank announced that it intends to capitalize on the platform’s strengths to enhance FX transaction efficiency and reduce settlement times from up to two days to near-instantaneous completion for Pound Sterling once regulatory approvals are secured.
This marks a significant move for JPMorgan, especially with respect to its strategy to scale up its blockchain applications, as revealed by its Global Head of Financial Institutions Payments, Umar Farooq. A year ago, Farooq predicted that JPM Coin would handle $10 billion daily within the next couple of years—a tenfold increase from its current reported volume.
JPMorgan executives told Bloomberg that they expect the new service to help attract more fintech clients and bring the blockchain platform closer to profitability. Naveen Mallela, global co-head of Kinexys, highlighted that this initiative would create a third revenue stream for the bank, stemming from FX spreads, in addition to fees and liquidity generated by JPM Coin.
However, institutional traders remain cautious; a recent survey by the bank of over 4,000 institutional traders indicated a decline in confidence in blockchain technology, with only 7% viewing it as promising in the next three years.
Alongside its blockchain initiatives, JPMorgan is advancing artificial intelligence. It recently introduced “LLM Suite,” a generative AI tool similar to ChatGPT, in its asset and wealth management division. The tools suite, according to the bank, helps employees with tasks like writing, idea generation, and document summarization, and it is integrated with internal systems to handle financial data securely.
In 2023, JPMorgan also launched an AI tool designed to analyze Federal Reserve statements, potentially signalling trading opportunities. According to JPMorgan economists, the tool’s early results have been positive, adding another advanced tech layer to the bank’s strategy for a competitive edge in financial markets.
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