![]() I pay you $1 for a donut today, and you get about 97 cents next week. On Square (NASDAQ: SQ), for instance, this comes to 2.75%. The processor also takes out a transaction fee and a “discount” - based on the risk of the transaction blowing up. My doughnut cash may take days to get to your doughnut shop bank account, during which time the transaction processor can hold the money and profit. It goes through a settlement process, which costs both time and serious money. If you sell me a doughnut, my money doesn’t go directly to you. The other party then does a transaction on the same encrypted ledger to take possession of the coins and convert them back into dollars.īoth parties to the transaction must be authorized by JPMorgan, through Quorum’s permissioning layer, and the JPM Coin doesn’t trade - it merely stands-in for real currency in the blockchain.Įvery small merchant knows about settlements and how much it costs. Instead of making a trade by running several transactions through a central bank, Quorum converts the value of a trade into JPM Coin, at 1 coin to the dollar, and places that trade on its encrypted general ledger, which is held by the bank. The goal is to create real-time gross settlement (RTGS) on trades. The effort is based on an experiment Singapore launched two years ago, with JPMorgan’s cooperation, dubbed Project Ubin. The JPM Coin is built on Quorum, a blockchain originally created for the Ethereum (ETH) coin. The bank’s chair of global research, Joyce Chang, telegraphed the move a few weeks ago, saying blockchain technology will have a real impact on trade finance within a few years. It’s an experiment in using blockchain - one that’s far more dangerous to the bank’s rivals than to JPMorgan, or the financial system. InvestorPlace - Stock Market News, Stock Advice & Trading Tipsīut it’s not.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |