JPMorgan will create a system of virtual depositary receipts


JP Morgan Virtual internship task 1 | Interface with the stock price datafeed

Largest bank JPMorgan Chase & Co has applied to register a new payment system using a distributed ledger to issue virtual depositary receipts secured by assets or bonds.

The future system is a distributed network like blockchain for tokenizing and trading assets. To create a token, the owner will be required to transfer the asset under management to a qualified custodian, who will then authorize the virtual receipt.

In fact, it will be a security token controlled by the SEC and other local regulators, which will limit the ways and regions of further transactions with it. Depending on the nature of the asset, the token holder will also be able to redeem the receipt for the underlying asset by transferring it to the custodian, who then liquidates the token..

JPMorgan believes that one of the ways to use the proposed system will be an IPO in the blockchain space. According to the company, this model will increase the responsibility of the organizers of the initial proposals.

JPMorgan will create a system of virtual depositary receipts

As a reminder, Wells Fargo Bank will use tokenization to protect data.

text: Ivan Malichenko, photo: Bloomberg

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