tl;dr
The largest U.S. bank is advancing into decentralized finance by partnering with Marex Group Plc and Brevan Howard Digital to use J.P. Morgan's Kinexys Digital Payments system. Kinexys offers real-time, 24/7 settlement on a programmable blockchain, improving payment speed, reducing costs, and mainta...
The largest bank in the United States is making significant advances into decentralized finance (DeFi) with strong ties to traditional finance (TradFi), highlighted by its recent partnership with Marex Group Plc and Brevan Howard Digital (BHD). Marex, a NASDAQ-listed financial services company, announced its collaboration with BHD to utilize J.P. Morgan's Kinexys Digital Payments system, aiming to reduce risks and streamline payments through blockchain deposit accounts. This move positions Marex as the first clearing company to adopt this system, enhancing operational efficiency and client service.
Kinexys, part of J.P. Morgan's blockchain business unit, enables real-time, 24/7 settlement using programmable blockchain infrastructure. This facilitates instant payments, lowers settlement times, and cuts costs while maintaining institutional-grade security tied to traditional finance rails. Terry Hollingsworth, Global Head of Futures & OTC Clearing Sales at Marex, underscores the platform's ability to leverage automation to unlock asset utility and improve market efficiency.
J.P. Morgan's journey with blockchain and cryptocurrency has evolved considerably from initial skepticism. CEO Jamie Dimon famously criticized Bitcoin, but the bank’s efforts began in 2016 with their Ethereum-based Quorum platform, later merging several initiatives into Onyx, which was rebranded as Kinexys in 2023. Since its launch, Kinexys has processed over $1.5 trillion in transactions, with daily volumes averaging $2 billion.
Recent developments include the introduction of JPMD, a digital representation of dollar deposits, and potential plans for offering crypto-backed loans. Notably, the bank is also forming a partnership with Coinbase, enabling Chase credit card holders to fund their exchange accounts directly with their bank cards, signaling further integration between traditional banking and crypto platforms.