Since February the 14th, when JPMorgan announced that it is launching a stable coin, the entire cryptocurrency community has been on fire. The unexpected move by the US banking giant has left many shocked and others wondering what the fate of XRP will be with this move. JPMorgan Chase will be the first United States bank to launch a cryptocurrency. The move attracted a lot of criticisms especially since the CEO of JPMorgan, Jamie Dimon, has a habit of trashing Bitcoin and cryptocurrencies as a whole.
What Does JPMorgan Chase Hope To Achieve With The Creation Of A Stablecoin?
According to the head of projects at JPMorgan, the coin was created with three core use cases. All these use cases are related to its institutional and corporate clients. For starters, the coin will be used to speed up cross-border transactions between clients on a 24-hour basis. Also, the coin will be used by institutional investors to make instant settlements rather than debt wires that are currently being used. The third use case is transaction consolidation. By replacing the dollars they have around the world, JPMorgan will afford its subsidiaries greater fluidity. Dimon added:
“The JPM Coin was developed to speed up money movement flows from one business to another. At this stage, this service will not be made available to individuals because it is still being tested. This cryptocurrency offers efficiency and cost-saving benefits to the customers of our institutional clients.”
Long-term Potential Of The JPMorgan Coin
The three use cases mentioned above refer to the short-term features of the coin. Dimon didn’t say anything about the possible long-term application of the JPM Coin. Long-term, the coin can be used as an end-run around the already existing remittance infrastructure. This is according to Ron Shevlin, a Forbes contributor.
Ron Shevlin, in a post published by Forbes, asked different financial experts what they think about the long-term potential of the JPM Coin. The managing director of First Performance, Charles Potts said:
For many years now, JPMorgan Chase has been trying to reduce its reliance on legacy payment systems. The cryptocurrency is similar to previous attempts like the clearXchange system. It is aimed at directly controlling how payment activities flow. If the project is successful, there will be many use cases of the Chase Quorum blockchain and Coin.”
The CEO of PayFi, Travis Dulaney said:
“This move by Dimon is competitive. Directly challenging Western Union for its spot in the $600 billion remittance market where JPMorgan Chase already has the number two spot is commendable. Dimon waited for Ripple to do all the hard work and pave the way for the adoption of a blockchain coin network. The payment systems in the United States are proprietary, they are not interoperable. So, the only way to truly compete is with a syndicate like Early Warning with The Clearinghouse and Zelle.”
XRP (XRP) Price Today – XRP / USD
Whether the critics of JPMorgan Chase like it or not, the announcement has long-term potential that extends beyond the three use cases that were mentioned. In the long-run and with successful implementation, the coin will reinvent the entire global remittance market.
Do you think the JPM Coin has the potential to disrupt the current financial market? Share your thoughts below.