GENIUS Act makes immediate impact as JP Morgan looks to allow crypto as collateral for lending
The post GENIUS Act makes immediate impact as JP Morgan looks to allow crypto as collateral for lending appeared on BitcoinEthereumNews.com. JPMorgan Chase is reportedly preparing to offer loans backed by client-held digital assets, including Bitcoin and Ethereum, marking a direct engagement with crypto collateralization by a global systemically important bank for the first time. The plan, reported by the Financial Times and Reuters, would expand an existing effort by the bank to accept spot Bitcoin ETFs as collateral. If implemented, the program could begin as early as 2026, according to people familiar with the discussions. The proposed expansion signals a broader acceptance of digital assets within regulated finance, aligning with a broader trend among large U.S. banks. JPMorgan’s initial phase will reportedly accept BlackRock’s iShares Bitcoin Trust and other SEC-approved spot-BTC ETFs. A second phase would involve lending directly against Bitcoin and Ethereum, provided the assets are held with approved third-party custodians such as Coinbase or Anchorage, in accordance with U.S. regulatory expectations. The move positions JPMorgan to serve institutional and ultra-high-net-worth clients seeking liquidity while retaining exposure to crypto markets. The strategy reflects shifting attitudes within JPMorgan’s leadership. CEO Jamie Dimon, once a vocal critic of Bitcoin, calling it a “fraud” in 2017, has since adopted a more pragmatic stance. In May, Dimon acknowledged that while he remains skeptical of Bitcoin itself, the bank will support clients’ rights to participate in the market and is committed to involvement in stablecoin infrastructure. Lending against crypto holdings could offer JPMorgan a capital-efficient revenue channel. The structure allows the bank to generate yield without forcing clients to liquidate long crypto positions. This model also introduces new regulatory and operational considerations. Direct lending against crypto requires mechanisms for handling defaults and liquidating digital collateral. As most U.S. banks do not hold crypto on their balance sheets, JPMorgan would likely use a third-party custodian to hold pledged assets in escrow. The firm will need…
The post GENIUS Act makes immediate impact as JP Morgan looks to allow crypto as collateral for lending appeared on BitcoinEthereumNews.com.
JPMorgan Chase is reportedly preparing to offer loans backed by client-held digital assets, including Bitcoin and Ethereum, marking a direct engagement with crypto collateralization by a global systemically important bank for the first time. The plan, reported by the Financial Times and Reuters, would expand an existing effort by the bank to accept spot Bitcoin ETFs as collateral. If implemented, the program could begin as early as 2026, according to people familiar with the discussions. The proposed expansion signals a broader acceptance of digital assets within regulated finance, aligning with a broader trend among large U.S. banks. JPMorgan’s initial phase will reportedly accept BlackRock’s iShares Bitcoin Trust and other SEC-approved spot-BTC ETFs. A second phase would involve lending directly against Bitcoin and Ethereum, provided the assets are held with approved third-party custodians such as Coinbase or Anchorage, in accordance with U.S. regulatory expectations. The move positions JPMorgan to serve institutional and ultra-high-net-worth clients seeking liquidity while retaining exposure to crypto markets. The strategy reflects shifting attitudes within JPMorgan’s leadership. CEO Jamie Dimon, once a vocal critic of Bitcoin, calling it a “fraud” in 2017, has since adopted a more pragmatic stance. In May, Dimon acknowledged that while he remains skeptical of Bitcoin itself, the bank will support clients’ rights to participate in the market and is committed to involvement in stablecoin infrastructure. Lending against crypto holdings could offer JPMorgan a capital-efficient revenue channel. The structure allows the bank to generate yield without forcing clients to liquidate long crypto positions. This model also introduces new regulatory and operational considerations. Direct lending against crypto requires mechanisms for handling defaults and liquidating digital collateral. As most U.S. banks do not hold crypto on their balance sheets, JPMorgan would likely use a third-party custodian to hold pledged assets in escrow. The firm will need…
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