Accelerate the embrace of digital assets! JPMorgan Chase explores mortgage loan business in digital currency.

Jpmorgan Chase is considering accepting loans from customers using cryptocurrencies as collateral, which is a major signal that the largest bank in the United States is beginning to recognize the move of digital assets into the mainstream financial system.

On Tuesday, July 22nd, media reports citing informed sources revealed that jpmorgan Chase may start directly accepting crypto assets such as Bitcoin and Ethereum as loan collateral as early as next year. At present, the relevant plans are still in progress and can still be adjusted. In contrast, rivals such as Goldman Sachs have not yet accepted cryptocurrencies as collateral.

This policy shift is of great significance to jpmorgan Chase CEO Jamie Dimon. Eight years ago, Dimon denounced Bitcoin as "fraud", claiming that it "would eventually collapse" and would only be useful to drug dealers and killers. Insiders said that Dimon's early fierce criticism of Bitcoin has alienated some potential customers who have profited from crypto assets or have long been optimistic about its potential.

Not only jpmorgan Chase, but the entire traditional financial industry is accelerating its integration with crypto assets. As the second Trump administration leans towards more lenient regulatory policies than the Biden administration, the shift in Washington's attitude towards cryptocurrencies is driving more banks to embrace digital assets.

The CEO of jpmorgan Chase has changed his stance

According to informed sources, Dimon had previously strongly criticized Bitcoin and even threatened that traders who traded in it would be fired, which has angered some potential clients who have become rich through cryptocurrencies or have long been optimistic about its value.

But recently, Dimon's remarks have softened somewhat. In May this year, he said, "I don't think you should smoke, but I defend your right to smoke." I defend your right to purchase Bitcoin. Just do it.

Jpmorgan Chase has previously begun to embrace cryptocurrencies and plans to allow the use of cryptocurrency ETFs as collateral for loans. If direct cryptocurrency assets are accepted as collateral in the future, it will be a further breakthrough.

Financial institutions are accelerating their layout, and the regulatory environment provides assistance

Behind this trend lies the loosening of the regulatory attitude in the United States. The second Trump administration tended to adopt more lenient regulatory policies than the Biden administration, which prompted more banks to reevaluate their digital asset strategies. Morgan Stanley is considering offering cryptocurrency trading services through the ETrade platform.

In addition, the US Congress has also recently sent out positive signals. The US House of Representatives passed a stablecoin regulatory bill last week, marking the first major crypto legislation approved by the US Congress. Large banks have welcomed the bill, believing that it will make it easier for them to conduct digital asset business. Unlike cryptocurrencies such as Bitcoin that are not backed by underlying assets, stablecoins are pegged to assets like the US dollar.

Technical and compliance challenges still need to be addressed

Despite the recovery of market sentiment, banks still face practical difficulties in promoting crypto lending business.

On the one hand, crypto assets may be used for illegal transactions, which requires banks to enhance their anti-money laundering and compliance mechanisms. On the other hand, if a client defaults, how to liquidate crypto assets is also a major technical obstacle.

Like most US banks, jpmorgan Chase does not hold cryptocurrencies on its balance sheet. Therefore, it is more likely that jpmorgan Chase will collaborate with third parties to have its clients' crypto assets held in custody on its behalf. Companies like the crypto trading platform Coinbase offer such services.

It is worth noting that although jpmorgan Chase has been reluctant to get involved in mainstream cryptocurrencies like Bitcoin in the past, it has actually been very active in the broader field of digital assets. As early as 2019, it launched one of the earliest bank-backed digital currencies in the industry.

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