JPMorgan Meets SEC to Discuss Blockchain’s Role in Capital Markets

JPMorgan Chase, the largest bank in the United States, has taken a proactive step in shaping digital asset regulation by meeting with the SEC’s Crypto Task Force. The meeting focused on the potential transformation of capital markets if major financial activities shift to public blockchains, and how regulatory frameworks might need to evolve in response.

According to a note released by the SEC on Tuesday, executives from JPMorgan and members of the crypto division discussed the broader implications of blockchain adoption in traditional markets. Topics included risk assessment, benefits of decentralization, and how firms like JPMorgan could position themselves competitively in a rapidly evolving financial landscape.

The bank also highlighted its current presence in the crypto ecosystem. Its digital platform already facilitates repurchase agreements — a critical segment of short-term lending — under its “Digital Financing” and “Digital Debt Services” categories. 

JPMorgan Pilots JPMD Deposit Token on Base

In a notable move toward onchain finance, JPMorgan announced the pilot launch of a deposit token named JPMD on Coinbase’s Base blockchain. The pilot program, expected to run for several months, will enable institutional clients of Coinbase to conduct transactions using JPMD once the initial testing phase concludes.

Just a day before the announcement, JPMorgan filed a trademark application for JPMD, detailing a suite of crypto-related services, including trading, transfers, and payment processing. The development signals the bank’s deepening commitment to blockchain-based infrastructure and its ambitions to lead in digital asset innovation.

No Stablecoin Plans, Deposit Tokens Seen as Superior

The JPMD trademark filing stirred speculation that JPMorgan might collaborate with other large banks to launch a stablecoin. However, Naveen Mallela, an executive at Kinexys — the bank’s blockchain arm — clarified that the bank views deposit tokens as a more effective solution for institutions. 

He emphasized that tokenized deposits, unlike stablecoins, are fully integrated into traditional banking systems and are backed directly by customer bank deposits.

These deposit tokens aim to deliver faster and more secure payments without the scalability issues associated with stablecoins’ fractional reserve models.