Yesterday First Abu Dhabi Bank (FAB) said it completed pilots of JP Morgan’s Coin Systems for blockchain-based payments. Last month, Bahrain’s Bank ABC was the first to soft launch blockchain-based payments using the same solution. In both cases, the focus is instant cross border payments.
However, the UAE’s FAB is at an earlier stage in the collaboration and hasn’t shared many details. It said it plans to continue exploring the opportunities offered by JP Morgan Coin Systems.
Meanwhile, Bank ABC started by using the DLT solution for Bahrain and US payment corridors, with plans for the UK, Singapore and Hong Kong.
While JP Morgan first unveiled JPM Coin years ago, it’s only within the last year that tokenized deposits have attracted significant attention. It is also a co-founder of the multi-currency cross border payment network Partior.
Now JP Morgan is starting to attract competition. Last week Citi announced its Citi Token Services offering corporate solutions based on tokenized deposits. Mastercard launched the Mastercard Multi-Token Network (MTN) in June, which will enable tokenized deposits to be used for payments across various blockchains, including public ones. Multiple startups have solutions targeting banks with similarities to JP Morgan’s Coin Systems. They include Adhara and SETL’s LedgerSwarm.
Another evolution is the involvement of central banks. In Brazil, the central bank’s CBDC solution is a wholesale one to support bank deposit tokens. The Bank of Korea has just unveiled a similar project.