Yesterday Bloomberg reported that JP Morgan Chase has developed a collateral management blockchain solution for traditional finance. Last week it executed its first transaction by tokenizing BlackRock money market fund shares and using them as collateral. This is the latest solution from its Onyx blockchain and digital assets division.
“What we’ve achieved is the frictionless transfer of collateral assets on an instantaneous basis,” said Ben Challice, JPMorgan’s global head of trading services. While the asset was a money market fund in this case, it plans to tokenize equities, fixed income and other asset types on its enterprise blockchain network. BlackRock wasn’t one of the counterparties but was heavily involved and is interested in the technology. It also enables collateral to be managed outside of normal trading house.
“As the crypto sector grows over time, there will be a growing set of financial activities that happen on the public blockchain, so we want to make sure that we are able to not only support that but also be ready to provide related services,” added Challice.
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