JPMorgan To Tokenize US Treasury and Include It in Its Crypto Strategy


Key Insights:

  • JPMorgan aims to leverage the yield-generating potential of mainstream assets.
  • This way, non-crypto assets will find use in the Bank’s DeFi plans.
  • Through institutional DeFi, the bank will impose KYC strictures on crypto’s permissionless lending pools.

The Decentralized Finance (DeFi) space is finding use in the mainstream bank market as well, with JPMorgan planning to leverage DeFi protocols to generate more profit out of non-crypto assets.

JPMorgan’s Institutional DeFi

Firstly discussing their Crypto Strategy during the CoinDesk Consensus 2022, the Head of Onyx Digital Assets at JPMorgan, Tyrone Lobban, stated that the bank has institutional-grade DeFi Plans, which include trillions of dollars worth of tokenized assets it will be making use of.

Iterating the same, Tyrone said,

“Over time, we think tokenizing US Treasurys or money market fund shares, for example, means these could all potentially be used as collateral in DeFi pools. The overall goal is to bring these trillions of dollars of assets into DeFi, so that we can use these new mechanisms for trading, borrowing [and] lending, but with the scale of institutional assets.”

In addition to this, the bank will also include tokenized versions of investment management corporation BlackRock’s money market fund shares.

These are basically mutual funds invested in cash and highly liquid short-term debt instruments.

JPMorgan and Crypto

In the past, too, the bank has commented on the future of Crypto, DeFi, and web3 and where it could end up.

As reported by FXEmpire, a few months ago, JPMorgan had predicted that the Metaverse could become a $1 trillion market based on the growth of its individual components, including the price of a parcel of virtual land, strategic partners as well as NFTs.

The same month the bank also stated that the day Bitcoin’s market cap sits at the level of Gold’s market cap, the value of one Bitcoin would be equal to $150k.

Although since then, the king coin has seen more crashes than rallies, so for the next few months, a reach of $150k is out of the question.

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