Ethereum

Token

JPMorgan

Base

June 27, 2025 – In a groundbreaking move for institutional finance, JPMorgan Chase &amp; Co., the largest U.S. bank by assets, has launched a pilot for its USD-backed deposit token, JPMD, on Base, the Ethereum Layer-2 blockchain developed by Coinbase.
This initiative marks the first time a major commercial bank has deployed a deposit-based product on a public blockchain, signaling a significant step toward integrating traditional banking with <a href="https://franknez.com/daily-crypto-news/" rel="noopener noreferrer nofollow">decentralized finance</a>.
Concurrently, Coinbase’s Base network has <a href="https://www.pymnts.com/blockchain/2025/jpmorgan-chase-says-deposit-token-offers-superior-alternative-to-stablecoins/" target="_blank" rel="noopener noreferrer nofollow">expanded</a> its offerings by adding support for wrapped versions of Cardano (ADA) and Litecoin (LTC), further solidifying its role as a hub for institutional and retail crypto activity.
JPMorgan’s <a href="https://franknez.com/jpmorgan-now-launches-its-new-token-jpmd/" rel="noopener noreferrer nofollow">JPMD</a> is a permissioned deposit token designed exclusively for institutional clients, representing a digital claim on U.S. dollar deposits held at the bank.
Unlike stablecoins such as Tether (USDT) or Circle’s USDC, which are typically backed by securities or cash reserves, JPMD operates within the fractional-reserve banking system, offering unique advantages like potential interest payouts and deposit insurance eligibility.
According to Naveen Mallela, global co-head of JPMorgan’s blockchain division Kinexys, “Deposit tokens are a superior alternative to stablecoins for institutions because they are based on fractional banking, which we think is more scalable.”
The pilot, which began with a transfer of a fixed amount of JPMD tokens from JPMorgan’s digital wallet to Coinbase, aims to enable near-instant, low-cost, 24/7 settlements for institutional transactions.
“JPMD is intended to enhance the global digital payments ecosystem by bringing trusted financial infrastructure onto public blockchain,” JPMorgan stated in a press release.
The token is built to facilitate use cases such as tokenized securities settlements, cross-border B2B payments, and collateral management for derivatives and margin trading.
This move builds on JPMorgan’s prior blockchain innovations, including its private blockchain platform, Kinexys (formerly Onyx Digital Assets), which processes over $2 billion in daily payments.
The JPMD pilot extends this infrastructure to a public blockchain for the first time, leveraging Base’s sub-second, sub-cent transaction capabilities to streamline institutional fund transfers.
Jesse Pollak, creator of Base and VP of Engineering at Coinbase, noted, “Base offers sub-second, sub-cent, 24/7 settlement, which makes fund transfers between J.P. Morgan institutional clients nearly instant.”
Related: <a href="https://franknez.com/federal-reserve-chair-now-endorses-banks-engagement-with-cryptocurrency/" rel="noopener noreferrer nofollow">Federal Reserve Chair Now Endorses Banks’ Engagement with Cryptocurrency</a>
<h2 class="wp-block-heading" id="h-regulatory-context-and-strategic-timing">Regulatory Context and Strategic Timing</h2>
The launch of JPMD comes on the heels of the U.S. Senate’s passage of the GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 Act) on June 17, 2025, with a 68-30 vote.
This legislation provides regulatory clarity for dollar-pegged tokens, encouraging banks to explore tokenized deposits without the legal uncertainties surrounding stablecoins.
JPMorgan’s strategic timing positions it as a first mover among major banks, with analysts suggesting that competitors like <a href="https://franknez.com/bank-of-america-is-freezing-accounts-in-new-scandal/" rel="noopener noreferrer nofollow">Bank of America</a>, Citigroup, and <a href="https://franknez.com/wells-fargo-is-now-freezing-bank-accounts-in-new-scandal/" rel="noopener noreferrer nofollow">Wells Fargo</a> are exploring similar initiatives.
Unlike stablecoins, which dominate the $262 billion retail crypto market, JPMD is tailored for wholesale financial operations, targeting corporations, asset managers, and pension funds.
The token’s permissioned nature ensures compliance with JPMorgan’s transaction monitoring and screening requirements, restricting transfers to approved institutional clients.
The bank plans to expand JPMD’s use cases and potentially support additional currencies, pending regulatory approval, with the pilot expected to run for several months.
In parallel with JPMorgan’s pilot, Coinbase announced that its Base network now supports wrapped versions of Cardano (ADA) and Litecoin (LTC), known as cbADA and cbLTC.
These ERC-20 tokens are backed 1:1 by ADA and LTC held in custody by Coinbase, ensuring full reserve backing.
“cbADA and cbLTC are now live on Coinbase,” the exchange posted on X, highlighting its commitment to expanding Base’s ecosystem.
This development enhances Base’s position as the leading Ethereum Layer-2 network, with nearly $4 billion in total value locked across applications ranging from decentralized finance to gaming.
By integrating support for Cardano and Litecoin, Base broadens its appeal to both institutional and retail users, complementing its role as a platform for JPMorgan’s JPMD.
<h2 class="wp-block-heading" id="h-what-s-next-for-the-future-of-finance">What’s Next for the Future of Finance?</h2>
JPMorgan’s foray into public blockchains with JPMD underscores a broader trend of traditional financial institutions embracing blockchain technology to remain competitive in the digital era.
With over $260 trillion in assets eligible for tokenization, the potential for deposit tokens to reshape capital markets is immense.
Analysts predict that if other banks adopt similar models, deposit tokens could surpass stablecoins as the preferred on-chain cash instrument for institutional transactions, offering greater regulatory compliance and integration with existing banking systems.
The collaboration between JPMorgan and <a href="https://franknez.com/coinbase-is-now-seeking-sec-approval-for-tokenized-stock-trading/" rel="noopener noreferrer nofollow">Coinbase</a> also highlights Base’s growing prominence as a bridge between traditional finance and blockchain.
“Coinbase is a long-standing J.P. Morgan client, and given its pre-eminent standing in the Web3 space, it is a natural collaborator for Kinexys’ pilot of JPMD,” said Mallela.
This partnership, combined with Base’s support for new assets like cbADA and cbLTC, positions the platform as a critical infrastructure layer for the evolving digital economy.
Despite its promise, JPMD’s adoption faces potential hurdles.
The Basel Committee on Banking Supervision imposes strict capital requirements on banks using permissionless blockchains, which could complicate scaling efforts.
JPMorgan’s choice of Base, a semi-permissioned Layer-2 network, may mitigate some regulatory concerns, but broader adoption will likely require further clarity from global regulators.
Additionally, while JPMD offers advantages like potential interest-bearing features, its permissioned nature limits its interoperability compared to decentralized stablecoins, which may restrict its appeal in certain markets.
JPMorgan’s launch of JPMD on Coinbase’s Base blockchain represents a pivotal moment in the convergence of traditional finance and blockchain technology.
By offering a regulated, scalable alternative to stablecoins, JPMorgan is paving the way for institutional adoption of tokenized assets, while Coinbase’s Base strengthens its position as a leading platform for both institutional and retail crypto activity.
As the financial industry navigates this transformative landscape, JPMD’s pilot could set a precedent for how banks leverage public blockchains to redefine global payments and asset management.
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JPMorgan Now Pioneers USD-Backed Deposit Token

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