JPMorgan Trial Puts Debt Issuance on a Blockchain

JPMorgan Chase has partnered with National Bank of Canada and other major firms to trial a blockchain platform aimed to improve the debt issuance process.

As reported by Reuters, the investment bank said in a statement Friday that the trial, which took place on Wednesday, mirrored a $150 million offering the same day by the the National Bank of Canada of a one-year floating-rate Yankee certificate of deposit.

The trial also saw participation from Goldman Sachs Asset Management, Pfizer, Legg Mason Inc’s Western Asset and others.

David Furlong, senior vice president of blockchain at National Bank of Canada, said in a statement that blockchain technology "has the potential to bring about major change in the financial services industry."

Based on JPMorgan's Quorum blockchain, the debt-issuance platform took over an year to build, according to the report.

As reported by CoinDesk in March, the bank is currently mulling spinning off the Quorum project as an independent company.

A spokesperson for the bank declined to comment on what they called "speculation" at the time, but said that "Quorum has become an extremely successful enterprise platform even beyond financial services and we're excited about its potential."

However, Umar Farooq, head of blockchain initiatives for JPMorgan’s corporate and investment arm, confirmed the move to Reuters in today's report, saying that discussions are in the early stages and the bank has had interest from financial institutions in the project.

The open-source Quorum blockchain was launched in 2016 as a permissioned version of ethereum. In October 2017, it notably integrated the zero-knowledge security layer (ZSL) from privacy-focused public blockchain zcash.

The technology obscures all identifiable information about a transaction but still provides the ability to audit those transactions.

JPMorgan image via Shutterstock