JPMorgan to Test Dollar Deposit Token JPMD via Ethereum Layer 2 Network Base

According to The Block, JPMorgan plans to test its US dollar deposit token JPMD on the Ethereum layer 2 network Base incubated by Coinbase exchange.

A spokesperson for JPMorgan told The Block that the bank plans to issue JPMD on the Base chain and expects to conduct the first transactions through the bank’s wallet “in the coming days.”

Base officially wrote on the social platform X on Tuesday:

JPMD is a “permissioned” deposit token for institutional clients, essentially a digital form of the deposits in a customer’s bank account, different from stablecoins. Stablecoins are tokens anchored to fiat currencies, typically backed 1:1 by a basket of securities (such as treasuries) or other highly liquid assets.

According to Bloomberg, this pilot program may involve the bank’s institutional clients, is expected to run for several months, and may expand to currencies other than the US dollar after regulatory approval.

Mallela stated that potential advantages of deposit tokens like JPMD include the possibility of becoming interest-bearing assets and being protected by deposit insurance, advantages that mainstream stablecoins currently do not possess. Mallela also mentioned in an interview with CNBC that institutions will be able to use JPMD for on-chain digital asset settlements and cross-border B2B transactions.

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