The research branch of one of the largest crypto exchanges-Binance that we cover often in our altcoin news has published a report where it says that the newly announced JPM Coin by JPMorgan Chase is a ‘’minimal direct competition’’ to Ripple’s XRP token.
As DC Forecasts previously reported, JPMorgan Chase announced the launch of their new stablecoin in the middle of February which will be backed 1:1 by the bank’s reserves.
Per the research, the JPM Coin project will mainly focus on value transfer between financial institutions and will be issued on a private blockchain network Quorum which is a fork of the public ETH blockchain.
The stablecoin is highly unlikely to directly compete with the XRP token because of its ambition to serve as a multi-bank mediator currency while the JPM Coin currently offers a closed network solution.
The Binance analysis suggests that the new JPM Coin ‘’could make the institution the largest stablecoin issuer on a blockchain measured by circulating supply and total market cap.’’
The study continues that the coin is likely to become a potential ‘’precursor to the third generation of stablecoins’’ which will aim to change the traditional financial institutions and will also have a purpose for the business regarding the private blockchain-powered tokens. Although the JPM Coin may have a significant impact on lowering the cost and is more time efficient, the study notes that:
“Large banks and financial institutions […] have a distinct set of advantages in issuing fiat-collateralized stablecoins, but these offerings will not displace liquid, publicly traded stablecoins in the near-term given their closed ecosystems built on private blockchains.”
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