JPMorgan Chase is expanding its involvement in digital assets with the planned launch of a stablecoin-like deposit token called JPMD.

The US banking giant told CNBC on Tuesday (June 17) that it plans to issue the token on Coinbase’s public blockchain Base, which operates on the Ethereum network.

Each JPMD token will represent a digital version of a commercial bank deposit.

Unlike public stablecoins such as USDT and USDC, JPMD will be a permissioned token, available only to JPMorgan’s institutional clients.

The token is designed to support round the clock settlement and allow for interest payments to holders.

“We see institutions using JPMD for onchain digital asset settlement solutions as well as for making cross border business to business transactions,”

said Naveen Mallela, Global Co Head of Kinexys, JPMorgan’s blockchain unit.

“Given the fact that deposit tokens would eventually be interest bearing as well, this would provide better fungibility with existing deposit products that institutions currently use,”

he added.

JPMorgan said deposit tokens offer key benefits compared to stablecoins by allowing institutions to move funds more efficiently while maintaining strong links with traditional banking systems.

Stablecoins are digital tokens typically pegged one to one to fiat currencies, but they remain largely unregulated in the US.

That may soon change as the GENIUS Act, a bill aimed at introducing a regulatory framework for stablecoins, is expected to go to a Senate vote.

Other jurisdictions have already introduced clearer rules.

The European Union’s MiCA regulation and the United Kingdom’s proposed crypto regime are shaping how stablecoins are governed.

The Financial Conduct Authority in the UK is currently consulting on measures that would require stablecoin issuers to ensure their tokens preserve their value.

Mallela told CNBC that Coinbase was chosen as a blockchain partner because of its strong track record and long standing relationship with the bank.

He added that early interest has come from “large institutional players who want more native onchain cash solutions from preeminent and reputed financial institutions.”

Speculation about JPMD had been growing after a trademark application was made public on Monday (June 16).

The filing detailed a wide range of crypto related services under the JPMD name, including trading, exchange, transfer and payment services for digital assets.

Although JPMD shares some characteristics with a stablecoin, JPMorgan emphasises that it is a distinct product designed to link digital finance with established institutional banking systems.

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