Author
Sujha Sundararajan
Author
Sujha Sundararajan
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JPMorgan Chase is reportedly exploring lending against clients’ Bitcoin and Ethereum holdings starting next year, sources told the Financial Times. However, they cautioned that the plans are subject to change.
The move would make JPMorgan one of the largest US banks to endorse crypto into mainstream.
JPMorgan Chase CEO Jamie Dimon, who has been a vocal skeptic of Bitcoin, calling the asset a “fraud.” However, he recently said that stablecoins are “real,” adding that JPMorgan will be involved both in deposit tokens and stablecoins.
One source familiar with the matter told the FT that CEO Dimon, who once said he would fire any trader who traded crypto, has isolated some clients who dealt with crypto.
Lending against crypto would let users pledge their BTC and ETH holdings to borrow loans. Major US banks’ pivot to crypto-based services follows a bullish crypto regulatory environment under the Trump administration.
JPMorgan Already Allows Clients to Borrow Against Crypto ETFs
The NYC-headquartered bank said in June that it will allow selected clients to borrow against crypto ETFs, starting with BlackRock’s iShares Bitcoin Trust. JPMorgan said it has plans to expand access to other funds after the rollout.
The change would apply to wealthy clients, marking a shift in how cryptos are factored into credit decisions.
However, lending against the actual digital assets would be the next key step. That said, JPMorgan would need to work on resolving the technical aspects of handling crypto seized from customers who failed to repay their loans.
CEO Dimon also said that the bank will soon let clients buy Bitcoin, clarifying that it will not custody it.
Big Banks Cheer US GENIUS Act
JPMorgan plans to directly lend against cryptos arrive days after the week when crypto won big in America. President Donald Trump signed the GENIUS Act into law at the White House last Friday, creating a clear stablecoin regulation.
“The entire crypto community, for years you were mocked and dismissed and counted out,” said Trump, adding that this signing is a massive validation.
Large Wall Street banks cheered the signing of the bill, calling the move an easier way for banks to deal with crypto assets. However, JPMorgan has remained cautious, setting realistic predictions on stablecoins. The banking giant forecasted that the stablecoin market will grow to $500 billion by 2028.
The bank doubled down on the trillion-dollar forecasts, calling them “far too optimistic.”
“The idea that stablecoins will replace traditional money for everyday use is still far from reality,” the bank noted.
