J.P. Morgan Expands JPM Coin to Ethereum as Banks Test Tokenized Finance

J.P. Morgan made JPM Coin available to institutional clients on Ethereum on Oct. 19, expanding the dollar deposit token beyond Base as banks develop ways to use digital assets in settlement and financing.

The Ethereum rollout gives institutional clients another network for JPM Coin. It is separate from a BNY-Citadel Securities Treasury repo workflow that connected tokenized settlement to overnight borrowing.

In the workflow announced Oct. 13, Citadel bought a two-year U.S. Treasury note through BNY using Tradeweb. BNY recorded a tokenized representation of the note on its private digital ledger, where the representation settled within minutes. Citadel then used the note as collateral in an overnight triparty repurchase agreement, with BNY providing cash.

A repurchase agreement, or repo, is short-term financing backed by securities. In a triparty repo, a third party manages collateral and settlement between the borrower and lender. The BNY workflow carried a Treasury purchase through digital settlement and into that financing process.

“BNY’s transaction is an important example of how tokenisation can improve the way securities are used in financial markets,” Brickken CEO and co-founder Edwin Mata said.

The distinction between the Treasury note and its digital representation matters. The representation settled on BNY’s ledger; the underlying note did not itself settle there. Federal securities laws continue to apply to securities in tokenized form.

The two bank efforts address different parts of institutional finance. J.P. Morgan’s expansion concerns access to a dollar deposit token, while the BNY transaction used a Treasury security to secure overnight cash. Both involve institutional clients, but the assets and workflows differ.

Deutsche Bank is targeting a European launch of digital-asset custody for institutional and corporate clients this year, subject to its regulatory timeline. The planned service would initially support Bitcoin (BTC), Ether (ETH) and selected stablecoins. Tokenized financial instruments are on the bank’s product roadmap.