Kinexys by J.P. Morgan, the firm’s industry-leading blockchain business unit, is bringing institutional finance onchain by piloting the issuance of JPMD, marking a significant step forward in the evolution of digital money. JPMD is a permissioned USD deposit token for live institutional payments on Base, the Ethereum Layer 2 blockchain built within Coinbase.

To date, stablecoins have been the primary option for onchain native digital payments on public blockchains, serving as a form of cash and facilitating transactions. Digital assets offer 24/7 settlement and real-time liquidity, and the JPMD proof of concept, a deposit token on Base, offers these unique advantages by seamlessly integrating with traditional banking systems and providing the ability to pay interest to holders. JPMD will be a permissioned token, eventually available exclusively to J.P. Morgan institutional clients.

By bringing commercial bank deposits onto Base, JPMD will enhance digital payments for institutions by making it faster and easier to move money. This marks the first time Kinexys is leveraging a public blockchain and will help accelerate the adoption of digital assets by appealing to both traditional and digitally native institutions.

Key Highlights:

• Innovative Solution: JPMD is a first-of-its-kind permissioned deposit token, to exclusively enable J.P. Morgan’s institutional clients to securely send and receive money onchain, enhancing the digital payments ecosystem.
• Kinexys Leadership: Since 2015, Kinexys by J.P. Morgan has been a global leader in blockchain-based financial infrastructure, providing onchain deposit accounts to clients on its private blockchain.
• Enhanced Efficiency: By integrating commercial bank deposits with Base, JPMD will accelerate digital payments for institutions, making fund transfers faster and easier.

Jesse Pollak, Creator of Base and VP of Engineering at Coinbase, said, “We are thrilled to see one of the world’s most prominent banks come onchain. Base offers sub-second, sub-cent, 24/7 settlement, which makes fund transfers between J.P. Morgan institutional clients nearly instant. Coinbase is a proud J.P. Morgan institutional client, and this pilot combines the credibility of both J.P. Morgan and Base to help bring institutional money into a more global economy.”

JPMD is intended to support near real-time peer-to-peer transfers between wallets on Base, providing institutional clients with the flexibility to transfer funds securely and efficiently with minimal delay. By reducing friction, clients will be able to enhance operational efficiency and support real-time financial decision-making.

Lauren Abendschein, VP of Institutional Sales at Coinbase, said, “We are excited to see Kinexys by J.P. Morgan issue deposit tokens on Base. Kinexys is leading the way to revolutionize banking operations by taking advantage of blockchain rails, which help reduce cost, enhance efficiency, and improve liquidity for institutions. Moving money onchain takes seconds, rather than days, and we’re glad to see institutions like J.P. Morgan support digital assets for their clients.”

Naveen Mallela, Global Co-Head of Kinexys by J.P. Morgan, said, "Kinexys by J.P. Morgan has been at the forefront of the industry, pioneering digital payments within our private blockchain environment. With the launch of JPMD, we are now bringing yield-bearing commercial bank money onto Base, one of the leading public blockchains. For institutional clients, JPMD combines the benefits of traditional banking with the innovation of blockchain technology—offering deposits backed by the bank’s balance sheet and settlement capabilities, with transactions executed 24/7 in near real-time on Base."

Deposit tokens like JPMD could be particularly valuable for clients seeking reliable liquidity and seamless integration with traditional banking systems as an attractive alternative to stablecoins. Onchain peer-to-peer transactions with JPMD could help clients have quick access to liquidity, enabling them to manage their cash flow effectively by aligning with traditional banking standards while leveraging blockchain technology.

This pilot brings trusted financial infrastructure onto public rails and provides a secure, on-chain form of money for institutional use.

Read more in Bloomberg (subscription required) and CNBC.