Bahrain’s Central Bank has reportedly successfully completed an overseas funds transfer trial made possible by JP Morgan’s digital currency JPM Coin.
Working with Onyx, the blockchain and crypto unit of the Wall Street giant, Bahrain’s Bank ABC has launched real-time payments for Aluminum Bahrain (Alba) with its counterparties in the United States using the JPM Coin system. .
According to the report, the lawsuit marks an advanced phase for Bahrain’s central bank’s efforts to explore blockchain applications in real-world remittances. The bank’s foreign exchange and IT departments are set to work on the introduction and commercialization of the technology in the near future.
JPM Coin serves as a payment rail and deposit account ledger, allowing participating entities to transfer U.S. dollars held on deposit with the largest bank in the United States, the report adds.
The actual amount that was involved in the lawsuit was not mentioned. But the development is massive for the wholesale payments industry, as JP Morgan moves more than $ 6 trillion every day to more than 100 countries for its corporate clients. Moreover, these will be the first real applications for a cryptocurrency in the banking industry, replacing decades-old networks like Swift, with others to come soon after the test of international payments.
JPM Coin Goes Online with Commercial Uses
Rasheed Al Maraj, Governor of the Central Bank of Bahrain, said: “We at the Central Bank of Bahrain are extremely pleased to announce the success of this test which aligns with our vision and strategy to develop and enrich continuously extended capabilities to stakeholders within our financial services industry in the Kingdom using advanced and cutting edge emerging technologies. Through our work with ALBA, Bank ABC and Onyx by JP Morgan, we aspire to resolve and eliminate the inefficiencies and problems that exist today in traditional cross-border payments.
Ali Moosa, senior country officer at JP Morgan Bahrain, described the project as part of a much larger trend towards tokenization of financial assets, adding: “The test carried out with Alba and Bank ABC will help inform further development of JPM Coin Systems for future use by our correspondent banking partners.
JP Morgan Chase revealed last year that a few customers have already started using their own cryptocurrency to instantly send and settle payments around the world.
Dubbed “JPM Coin,” the stablecoin facilitates the transfer of payments between institutional clients, the latest step in Wall Street’s evolutionary approach to crypto. However, the coin is only available for international payments for large corporate clients, which have undergone regulatory checks.
The New York-based lender has started testing its JPM Coin together with corporate clients with the ultimate goal of speeding up transactions, such as cross-border payments and corporate debt issuance.
JPMorgan, whose CEO Jamie Dimon has previously called cryptocurrencies a fraud that won’t end well for its investors, has created a new unit to run its blockchain business called Onyx.