JPMorgan Chase is reportedly exploring plans to offer loans directly collateralized by clients’ Bitcoin and Ethereum holdings, possibly beginning next year.
Sources have informed the Financial Times that JPMorgan Chase is reportedly considering lending against clients’ Bitcoin and Ethereum holdings beginning next year.
Nevertheless, they issued a warning that the plans are susceptible to modification.
Due to this action, JPMorgan would become one of the largest US institutions to endorse crypto in the mainstream.
Jamie Dimon, the CEO of JPMorgan Chase, has been a vocal opponent of Bitcoin, characterizing the asset as a “fraud.” Nevertheless, he recently stated that stablecoins are “real” and that JPMorgan will be involved in deposit tokens and stablecoins.
The Financial Times was informed by a well-versed source that CEO Dimon, who previously stated that he would terminate any cryptocurrency trader, has now isolated specific clients who engage in cryptocurrency transactions.
Lending against cryptocurrency would enable users to obtain loans by pledging their BTC and ETH holdings. The Trump administration’s bullish regulatory environment for crypto has prompted major US institutions to transition to crypto-based services.
Clients of JPMorgan Can Already Borrow Against Crypto ETFs
In June, the bank, which is headquartered in New York City, announced that it would permit a limited number of clients to borrow against crypto ETFs, beginning with BlackRock’s iShares Bitcoin Trust. After the implementation, JPMorgan intends to broaden its access to additional funds.
The modification would apply to affluent clients, indicating a change in how cryptos are considered in credit decisions.
Nevertheless, the subsequent critical phase would involve lending against digital assets. Nonetheless, JPMorgan would be required to address the technical aspects of managing cryptocurrency seized from consumers who have not repaid their loans.
CEO Dimon also stated that the bank would shortly allow clients to purchase Bitcoin, but he clarified that it would not be held in its custody.
Big Banks Cheer US GENIUS Act
In the days following the week, crypto gained significant traction in the United States, and JPMorgan intends to lend against cryptos directly. President Donald Trump signed the GENIUS Act into law at the White House last Friday, establishing a distinct regulation for stablecoins.
Trump stated, “The entire crypto community, for years you were mocked, dismissed, and counted out.” He also emphasized that this signing is a significant validation.
The bill’s signing was applauded by major Wall Street institutions, who characterized it as a more convenient method for managing crypto assets.
Nevertheless, JPMorgan has maintained a prudent stance, establishing realistic expectations regarding stablecoins. By 2028, the banking behemoth anticipates that the stablecoin market will expand to $500 billion.
The bank reiterated its commitment to the trillion-dollar projections, describing them as “extremely optimistic.”
The bank observed that the notion that stablecoins will supplant conventional money for everyday use is still far from reality.
