JPMorgan’s JPMD Token: Same Old Bank, New On‑Chain Wrapper Yesterday’s pilot of JPMD, JPMorgan’s dollar deposit token on Coinbase’s Base chain, is being pitched as an innovation. But peel back the gloss, and what you get is business-as-usual—just dressed in on-chain branding. Let’s be clear: this isn’t a stablecoin. It’s a digitized bank IOU with all the same embedded risks—and fees—of traditional banking. Fractional reserve still applies: JPMorgan isn’t issuing JPMD 1:1 against segregated reserves like stablecoins backed by Treasuries (e.g. USDC or USDT). Instead, it's a tokenized deposit, subject to the same fractional reserve practices that failed banks in recent history. Fee structure unchanged: Don’t expect cheaper remittances or democratized access. JPMorgan will likely still charge its customary fees for deposit services. The token simply adds a Base network transaction fee on top. Programmability for whom? Certainly not for the average retail user. So far, this is a tool for JPMorgan’s institutional clients, running in a permissioned walled garden. Not a Stablecoin—and That’s the Point By sidestepping the stablecoin label, JPM avoids oversight typically applied to non-bank issuers (e.g. audits, transparency rules, or capital ring-fencing). But that also means: - No real-time attestations - No 1:1 reserve disclosures - No retail issuance model This isn’t a USD alternative. It’s a centralized bank balance dressed up in ERC-20 clothing. Fails to Do What Matters: In a widely shared tweet, former Soros CIO Scott Bessent summed it up: “JP Morgan’s new stablecoin isn’t even a stablecoin. It’s just their bank deposits on chain. - No new market for U.S. Treasuries. - No change to fees. - No change to risks. Nothing innovative.” This hits the mark. No treasury demand: Unlike regulated stablecoins (e.g. Circle), which drive billions in daily demand for U.S. Treasuries, JPMD does nothing to expand the sovereign debt market. No risk reduction: There’s no de-risking from systemic banking exposure. In fact, JPMD compounds single-institution counterparty risk. No interoperability: Operating on a permissioned layer of Base, JPMD isn’t accessible to the broader DeFi ecosystem—blocking out composability. While JP Morgan's whitepaper touts “programmability” and “24/7 transferability,” there’s no disruption to JPMorgan’s established cost structure: Fees remain: JPMorgan will likely continue charging its normal deposit and transaction fees. The whitepaper does not state that deposit tokens reduce fees. Network costs added: Users must pay Base chain gas fees—unless the bank covers them (likely for institutional clients only). In short: Blockchain doesn’t lower costs—it merely layers on traditional fees with on-chain transaction charges. Bottom Line: JPMD isn’t the future of money—it’s a white-labeled bank account running on a blockchain. It preserves JPMorgan’s control, revenue model, and systemic exposure while using crypto rails for settlement polish. - For institutions? It’s convenient. - For innovation? It’s inert. - For retail? It's irrelevant, so far ... Until tokens like JPMD offer real yield alternatives, treasury demand growth, or systemic safeguards, they remain what they are: banking as usual—this time, just on-chain.