JPMorgan (JPM) CEO Jamie Dimon famously called Bitcoin (BTCUSD) a “fraud” in 2017 and spent years comparing it to pet rocks, suggesting that its primary purpose is to serve scammers and money launderers.
At times, his comments have sunk the Bitcoin price, with many on Wall Street looking to Dimon as a “guru” on all things finance.
Now though, his company’s under-the-radar moves show that not only has Dimon changed his tune – but that JPMorgan is betting the current selloff in crypto will be short lived.
From Pet Rock to the Real Deal
Dimon started by admitting he was wrong on Bitcoin… or at least that the “blockchain is real.” JPMorgan has been building out its own blockchain over the last several years, focusing on serving its institutional clients in ways that typically don’t warrant much mainstream attention.
And while its latest move still caters to elite, institutional clients, it sets the stage for huge things to come across the crypto universe.
Early in November, JPMorgan became the first bank to issue a U.S. dollar deposit token on a public blockchain. Stripping out the jargon, this means that its clients can make instant money transfers via Coinbase’s (COIN) Base blockchain at any time of the day. This is a huge evolution from traditional U.S. banking hours and transfers that could take several days to clear.
JPMorgan filed the trademark application for “JPMD,” its new deposit token, back in June, signaling its intention to enter the digital asset space as stablecoin regulations became more favorable under the GENIUS Act, backed by President Donald Trump’s administration.
What Is a Deposit Token and How Is It Different from a Stablecoin?
JPM Coin, and other deposit tokens, are not the same as stablecoins like Tether’s USDT (USDTUSD) or Circle’s (CRCL) USD Coin (USDC).
Stablecoins are unique digital currencies issued by private companies, typically pegged 1:1 to the dollar and backed by reserves such as Treasury bills.
Deposit tokens are not currencies. Instead, you can think of them as a blockchain-based version of existing bank deposits. They are issued by licensed commercial banks and represent real customer deposits sitting in bank accounts. They’re subject to banking regulations, backed by FDIC-insured funds, and can pay holders interest on their deposits.
“We think that stablecoins get a lot of buzz, but for institutional clients, deposit-based tokens offer a compelling, yield-bearing alternative,” JPMorgan explained in a press release.
To put this in perspective, imagine if Coinbase and Mastercard (MA), who each have around $9 billion in cash on their books, were able to generate an extra 1% yield on their cash with JPMD.
That would mean an additional $90 million in annual compounding interest on their short-term assets, which could be passed on to users, shareholders, or reinvested in the companies. Since these large financial firms need liquidity on hand to settle transactions and ensure customers can make trades, this could simultaneously reduce risk and create more income streams.
So, although JPMD right now is just a tool for institutional use, it could have massive ripple effects that reach even everyday bank customers and credit card users.
Why It Matters
Perhaps the most important takeaway for individual investors right now isn’t JPMD itself. It’s the fact that JPMorgan is still making disruptive moves in blockchain as Bitcoin prices plunge nearly 30% in a matter of a few short weeks.
BTC is now trading at the $90,000 level not long after setting new all-time highs above $126,000. And Ethereum (ETHUSD), its No. 2 peer, has been no better. ETH is off its 2025 highs by nearly 40%, while smaller cryptocurrencies like Cardano (ADAUSD) and Solana (SOLUSD) are off nearly 50% and 60%, respectively.
This means that even a man who once likened Bitcoin to a literal rock knows that this pain isn’t here to stay… and his company wants to be ready to take advantage of the next crypto boom. Wise investors will do the same.
On the date of publication, Justin Estes did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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