[hybridsole]

Why does JPM Coin need a distributed ledger if it will inevitably have identity requirements and central control by the bank itself? This is something like when CompuServe wanted to create their own version of the internet, and pretend it was still open. No thank you. Bitcoin is both open, distributed, and has a non-inflationary gold-like token as its underlying currency.

[gervase]

The way I see it, most existing financial transactions are trust-based. Many cryptocurrencies aim to be trustless. I see this as a compromise, with the visibility and implementability of cryptocurrencies, while still being trust-backed.

This way, if there is a problem with a transaction, or the currency, etc. there is someone left holding the bag, which is a better fit with the existing legal infrastructures that are already in place.

I'm actually pretty surprised that this is coming from a corporation, and not a national government. SWIFT can be an absolute bear, and providing a programmable currency interface à la Stripe, but with lower fees and the full backing of a government could be a killer app for international trade facilitation.

[nwah1]

One of the main benefits of trust is to be able to rollback transactions. A warm fuzzy feeling of trust is not what is needed.

This provides the fuzzy feeling without any tangible benefit, and all the of the downsides of trustlessness.

[duxup]

You raise an interesting idea.

One of the issues with concurrency is the assumption that the transaction is between two non trusting parties (obviously it doesn't have to be that way). Most business don't want to / don't do business if they don't trust each other... and if they do trust then there are other ways to do business.

Not sure if this JPM coin addresses that exactly, but it is kind of interesting.

[bduerst]

That just makes it redundant though, right? A trustless coin from a trusted vendor isn't going to be used because it's trustless, and it's introducing extra complexity.

Also, any international benefit is just temporary arbitrage. The increased costs associated with international transactions comes from the high risk, which will inevitably catch up to any system that becomes popular.

[thefounder]

Bitcoin is the most expensive and risky(for the client due volatility) method of payment I've ever used. Why would a bank or a client use it?

Source: We used to accept bitcoin(via bitay).

[olefoo]

This is not Bitcoin, it's a stablecoin with a guarantor.

The failure modes of DLT are going to be interesting. But the currency risk is far lower than with regular bitcoin since it's not an independent currency but is pegged to the dollar.

[bduerst]

Which means you should just use dollars instead of a bank's walled-garden coin.

[olefoo]

It's in a fuzzy gray area; it's more an accounting unit than a separate currency. The main advantage I see is that JPM does not have to spend as much on internal controls if txns are recorded in a multi-party ledger. The benefit to customers is that they could in theory trade JPMCoin with other bank customers and have some of the "programmable money" benefits of ethereum without the risk and regulatory exposure.

[dractori]

Bitcoin is also 5-10%+ owned by an unknown person/entity.

[wtfrmyinitials]

Ok... and? Ownership != control on the Bitcoin network.

[asasidh]

how does that work for USD cash ?

[stale2002]

All a crypto currency is, is a public, append only database. Your question is like asking "why does JPM need a public append only database".

Well, there are lots of reasons why this is useful. The biggest reason, IMO, is that it allows customers who use it, to transparently see the ledger. This reduces (but does not entirely get rid of!) trust requirements. That's useful, in and of itself.

[scottlocklin]

Because there are counterparties. Duh. Quorum is a perfect case study for an actually useful blockchain use case.