Major investment bank JPMorgan Chase & Co has launched a pilot project using blockchain to calculate collateral for loans and borrowings.
How informs Bloomberg publication, several test transactions have already been carried out. The first one took place on May 20. As part of testing, the developers conducted a transaction with the transfer of tokenized shares of the BlackRock fund as collateral.
Once commercially operational, the new system will allow investors to use a wider range of assets to secure loans.
“What we have achieved is the instant transfer of collateral assets without any delay. BlackRock has been actively involved in the project since day one and is exploring the use of this technology,” said Ben Challice, head of trade services at JPMorgan.
A blockchain-based collateral calculation system can be useful, for example, in derivatives and repo trading, as well as in securities lending. In the coming months, the bank plans to expand support for tokenized collateral to include stocks, bonds and other types of assets, Challis said.
Note that JPMorgan has been using blockchain for repo trading with Goldman Sachs and BNP Paribas since the end of 2020. To date, the volume of transactions has exceeded $300 billion.
Caitlin Long, founder of startup Custodia Bank (formerly Avanti Financial), said in late March that Goldman Sachs’ indecision allowed JPMorgan to outperform a competitor in the cryptocurrency market.
Source: Bits
I’m James Harper, a highly experienced and accomplished news writer for World Stock Market. I have been writing in the Politics section of the website for over five years, providing readers with up-to-date and insightful information about current events in politics. My work is widely read and respected by many industry professionals as well as laymen.
