Despite Jamie Dimon’s infamous condescension of crypto, banking giant JPMorgan just executed its first-ever cross-border transaction using decentralized finance (DeFi) on a public blockchain.
As Cointelegraph reports, the trade was facilitated by the Monetary Authority of Singapore’s (MAS) Project Guardian on Nov. 2 – which was established as part of a pilot program to “explore potential decentralized finance (DeFi) applications in wholesale funding markets.”
Bloomberg reports that JPMorgan issued tokenized S$100,000 ($71,000) and then traded it for tokenized yen with Tokyo-based banking firm SBI Digital Asset Holdings.
Singapore’s largest bank – DBS Bank, and business leadership platform Oliver Wyman Forum also took part in the pilot program.
“Today was the first step to show that we can actually trade on these public networks,” said Tyrone Lobban, head of Blockchain Launch and Onyx Digital Assets at JPMorgan, in an interview.
“The future is really working toward scaling this pivotal moment.”
WORLD! J.P. Morgan has executed its 1st *LIVE* trade on public blockchain using DeFi, Tokenized Deposits & Verifiable Credentials, part of @MAS_sg Project Guardian 🙌🚀🔥https://t.co/XI212SG4zg Many world 1sts here, & since this is public ⛓ here’s a transparent🧵on what we did:
— Ty Lobban (@TyLobban) November 2, 2022
“We clearly see what’s happening in the public domain and we can see how the innovation is creating not only new ways of doing financial transactions, but new types of products as well,” Lobban said, noting that the bank will explore using other blockchain networks over time, he added.
MAS Chief Fintech Officer Sopnendu Mohanty said the successful test was a “a big step towards enabling more efficient and integrated global financial networks”, and the latest pilot has helped develop the country’s digital asset strategy, adding that:
“The live pilots led by industry participants demonstrate that with the appropriate guardrails in place, digital assets and decentralized finance have the potential to transform capital markets.”
While the transaction wasn’t a crypto trade, it used the infrastructure developed by crypto firms: the Polygon blockchain, which makes transactions on the Ethereum blockchain cheaper, and a modified version of Aave, a major DeFi lending project.
MATIC, a utility and staking token within the Polygon blockchain ecosystem, rose over 18% to $0.985 after the announcements, accompanied by an uptick in daily trading volume.
Additionally, Goldman Sachs is set to unveil a data service created with global index provider MSCI and crypto data firm Coin Metrics that seeks to classify hundreds of digital coins and tokens so institutional investors can make sense of the new asset class.
“The digital asset ecosystem has really expanded over the last couple of years,” said Anne Marie Darling, head of client strategy for Goldman’s Marquee platform, in an interview with CNBC.
“We’re trying to create a framework for the digital asset ecosystem that our clients can understand, because they increasingly need to think about performance tracking and risk management in digital assets.”
It seems the bulge bracket banks are starting to realize there may be ‘another way’. Are they readying themselves for a pivoting Fed’s money flood sending crypto prices soaring as institutional investors seek any haven from the central planners’ inflation?
Tyler Durden
Thu, 11/03/2022 – 19:20
