JPMorgan is looking for a crypto clearinghouse: Report
March 16, 2021, 7:55AM EDT
1 min read
Banking giant JPMorgan is reportedly looking to work with a crypto clearinghouse to add liquidity to the market.
Forbes reported the news on Monday, citing a "senior JPMorgan executive," who spoke with the publication "on background." The executive said, "we will fundamentally need a crypto clearinghouse to see that liquidity. Once that exists, banks will move their liquidity to it."
Clearinghouses act as a middleman between buyers and sellers in financial markets. They validate and finalize transactions, ensuring that both buyers and sellers honor their contractual obligations. The JPMorgan executive told Forbes that crypto clearinghouses are needed to avoid "the kind of liquidity problems that trading app Robinhood ran into."
Ethereum had a breakout year in 2021. It’s native asset, ETH’s, market capitalization surpassed $500 billion for the first time. Its network facilitated upwards of $7 trillion value transfer. Non-fungible tokens (NFTs) emerged as another “killer application” that have put its technology on the global stage and caught the attention of the masses.