On JP Morgan's Digital Money
Last week, JP Morgan announced that the firm is working on a JPM Coin and said it "is a digital coin designed to make instantaneous payments using blockchain technology. Exchanging value, such as money, between different parties over a blockchain requires a digital currency, so we created the JPM Coin.
“We have always believed in the potential of blockchain technology and we are supportive of cryptocurrenciesas long as they are properly controlled and regulated.
"As a globally regulated bank, we believe we have a unique opportunity to develop the capability in a responsible way with the oversight of our regulators. Ultimately, we believe that JPM Coin can yield significant benefits for blockchain applications by reducing clients’ counterparty and settlement risk, decreasing capital requirements and enabling instant value transfer."
Separately, Brad Garlinghouse, CEO of Ripple Labs commented on Twitter: “As predicted, banks are changing their tune on crypto. But this JPM project misses the point – introducing a closed network today is like launching AOL after Netscape’s IPO. 2 years later, and bank coins still aren’t the answer.”
JP Morgan’s efforts, which are at an early stage, are another indication that the nature of money continues to evolve. New digital coins and payment systems will address various corporate and consumer needs on social networks, central banking platforms, gaming systems and more.
Successful digital currencies, distributed ledgers and related technologies need to: 1) execute transactions in a secure and timely fashion, 2) provide services that are easy to use and 3) adapt to the market's changing needs.
Competition and innovation will come from start-ups, incumbent financial players and firms such as Alibaba, Amazon, Apple, Google, PayPal, Starbucks, Square and Tencent.
Regarding Brad Garlinghouse's comments: Ripple’s digital payment platform was among the first "next-generation" offerings. The market is becoming more competitive.