On Wednesday, the Central Bank of Bahrain announced that a trial of JP Morgan’s JPM Coin digital currency system had been completed successfully. First announced in May, the tests involved commercial Bank ABC and its client Aluminium Bahrain (ALBA). ALBA used the enterprise blockchain system for real-time US Dollar payments with U.S. counterparties that are also JP Morgan bank account holders. The central bank oversaw the trial.
The JPM Coin system tokenizes money held in JP Morgan bank accounts and is not a stablecoin. Digital currency payments are direct, sidestepping the need for intermediary or correspondent banks. However, that wouldn’t be needed with all parties banking at the same bank. By digitizing the currency, it becomes programmable, giving corporates greater flexibility for the timing and conditions that trigger payments.
“The pilot was tested using US dollars, and this technology will allow us to scale-up our existing offering and introduce more currencies in the future,” said Sael Al Waary, Deputy Group CEO of Bank ABC. “We envisage major changes across the world with digital currencies, which will play a critical role in enabling future digital economies.”
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