JPMorgan’s Tokenized Collateral Network (TCN) Goes Live with BlackRock and Barclays Transactions
Crypto News – JPMorgan’s Tokenized Collateral Network (TCN) has made its much-anticipated debut, successfully facilitating its inaugural transaction involving major clients BlackRock and Barclays.
In this groundbreaking move, BlackRock utilized TCN to transform shares from one of its money market funds into digital tokens, swiftly transferring them to Barclays as collateral for an over-the-counter derivatives trade. This landmark transaction was disclosed in an interview with Tyrone Lobban, the Head of Onyx Digital Assets at JPMorgan, as reported by Bloomberg.
TCN underwent rigorous internal testing within JPMorgan in May 2022. During this phase, tokenized representations of shares from a BlackRock money market fund were employed as collateral on JPMorgan’s private blockchain platform, Onyx Digital Assets. With TCN now live and operational, JPMorgan is actively engaging a pipeline of clients and transactions, according to Ed Bond, the Head of Trading Services at JPMorgan, as shared with Bloomberg.
The speed and efficiency of TCN are transformative, expediting collateral movement almost instantaneously compared to the conventional day-long processes, as emphasized by Lobban. Upon broader implementation, TCN has the potential to significantly enhance efficiency by liberating tied-up capital for utilization as collateral in ongoing transactions.
TCN is initially focused on money market funds; however, plans are underway to diversify its collateral assets, incorporating equities and fixed income into its repertoire.
Tokenizing assets is predicted to revolutionize transaction speed, akin to bypassing the conversion of paper money into coins for a vending machine. With tokens, transactions are expedited, ensuring a swifter and more efficient process.
In addition to TCN, JPMorgan operates JPM Coin, a blockchain-based payment system renowned for its operational resilience beyond regular banking hours and faster transaction processing. Recently, JPM Coin expanded its support to include euro transactions, alongside its existing support for the U.S. dollar.
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