J.P. Morgan Taps Marex as Clearing Firm for Settlements on its Blockchain

The largest bank in the United States continues its stride into DeFi innovation with TradFi roots, marking a partnership with two financial institutions.

Improving Solid Foundations

Marex Group Plc, a publicly traded financial services company listed on the NASDAQ (MRX), made an announcement last week regarding a collaboration with Brevan Howard Digital (BHD), a digital asset management division, to leverage J.P. Morgan’s Kinexys Digital Payments system for reduced risk and more efficient payments.

Marex will be the first clearing company to utilize the blockchain deposit accounts of this system, streamlining its work with its client base. BHD joined Kinexys last year and has been working diligently with industry peers to aid in the development of a programmable blockchain infrastructure ecosystem.

The payments system, part of the bank’s pioneering blockchain business unit, enables partners to facilitate instant settlements around the clock in real-time using its network of blockchain accounts. With it, Marex and BHD can improve payment settlement time, reduce risks and costs, whilst upholding the institutional security provided by traditional finance (TradFi) payment rails.

“Kinexys by J.P. Morgan is the next generation of financial market infrastructure.

By enabling programmable payment and settlement, the platform leverages automation to unlock the utility of assets and reduce risk.

As a firm with innovation and client service at our core, we are proud to collaborate with Brevan Howard Digital on this forward-looking initiative, bringing greater operational efficiency to our clients as well as the wider market.” Said Terry Hollingsworth, Global Head of Futures & OTC Clearing Sales, Marex

A Little Backstory

The prominent global financial institution was not always as lenient towards cryptocurrency and the blockchain as it is currently. Its CEO, Jamie Dimon, has called Bitcoin “fraud” on numerous occasions, and his stance remains cautious to this day.

Their journey into the space began in 2016 with the launch of their Ethereum-based blockchain platform, Quorum, followed by the introduction of their own JPM coin in 2019. In 2020, both initiatives were merged under one umbrella called Onyx.

In early November last year, Onyx became Kinexys, with the platform reportedly processing over $1.5 trillion in transaction volume since its inception and having an average daily transaction volume of $2 billion.

The current year saw J.P. Morgan launch a new coin, JPMD, which will represent dollar deposits at the bank, and there are also rumors that they will start offering crypto-backed loans next year. Additionally, we should mention their ambitious move to join forces with Coinbase, which will allow Chase credit card holders to fund their accounts on the exchange using their bank cards.