From ComputerWorld: J.P. Morgan Chase plans to launch what is considered to be the first cryptocurrency backed by a major bank, a move that could legitimize blockchain as a vehicle for fiat cryptocurrencies.
JPM Coin, as the bank is calling its new cryptocoin, is considered fiat currency because it's backed by U.S. dollars in accounts designated at JPMorgan Chase N.A.
One JPM Coin has the equivalent value of one U.S. dollar. Trials for the new cryptocoin are expected to begin in the next few months, according to a CNBC report.
In the crypto industry, an instrument like JPM Coin is known as a "stablecoin" because it has an intrinsic value, unlike Bitcoin or Ethereum's ETH coins, whose value is based on supply and demand of virtual money.
"When one client sends money to another over the blockchain, JPM Coins are transferred and instantaneously redeemed for the equivalent amount of U.S. dollars, reducing the typical settlement time," JPMorgan said in an online FAQ. "The JPM Coin is based on blockchain-based technology enabling the instantaneous transfer of payments between institutional accounts."
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