Top US financial institutions test blockchain-based platform for debt issuance

Cornelia Mascio
Aprile 21, 2018

James Dimon, Chairman of the Board and CEO of JPMorgan Chase & Co, attends the Paris Europlace International Financial Forum in Paris.

One of the largest financial broker in the United States JP Morgan on Wednesday tested a new blockchain system for issuing financial instruments with the National Bank of Canada and other large companies. During the test, a simulation of the Canadian bank's $150 million offeringon the same day of a one-year floating-rate Yankee certificate of deposit was conducted.

JPMorgan tests issuing financial instruments on the blockchain. "National Bank of Canada will continue to innovate over the coming years and remain on the lookout for ways we can bring our partners greater value".

The pilot also included Goldman Sachs Asset Management, pharma giant Pfizer, and Legg Mason's Western Asset, which acted as investors in the Yankee CD.

David Furlong, Senior Vice-President - Artificial Intelligence, Venture Capital, and Blockchain at National Bank of Canada while speaking about the prospects of the debt issuance platform said that "This is a unique opportunity for us to expand our knowledge of blockchain. There are few cases where blockchain can really shine", said Umar Farooq, head of blockchain initiatives at JPMorgan. The source was not authorized to discuss the matter publicly.

As a result of the high levels of interest, the company is allegedly considering spinning off the business into a separate division, with the company also looking to appoint more of its own employees who are versed with blockchain to its Quorum team in order to support this demand.

Blockchain is in the early stages of development in the financial industry, but JPMorgan is optimistic about its potential, Farooq said.

"We haven't really seen a lot of really large scale things go into production yet".

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