How Should an Investment Bank Use Blockchain? A Case Study of JPMorgan Kinexys

JPMorgan Kinexys reveals the true scale of its on-chain payments.

Written by: @ekko_924, @ryanyoon_eth

Compiled by: AididiaoJP, Foresight News

JPMorgan is the world's largest dollar clearing bank, processing about $12 trillion daily. Its blockchain division, Kinexys, is building around these payments to create products that operate around the clock.

The flagship product is the Blockchain Deposit Account (BDA), which allows companies to allocate funds at any time, estimating an average daily transaction volume of about $3.5 billion, accounting for approximately 0.03% of JPMorgan's total payment volume. This estimate assumes that BDAs still account for about half of Kinexys's total transaction volume.

The JPM Coin, which converts deposits into tokens, has recorded only 48 transfers on Base since its initial issuance. The intraday repurchase service has been open for a while, but no data has been disclosed since 2022.

In contrast, a tokenized fund, JLTXX, reached a net asset value of $800 million within two months, likely because stablecoin issuers deposited reserves into it.

These numbers are still small. However, JPMorgan is gradually expanding its blockchain business using its existing payment clients and deposit base.

How a Bank Settling $12 Trillion Daily is Approaching Blockchain

JPMorgan processes about $12 trillion daily across 120 currencies. Payment business revenue is projected to reach $19.3 billion in 2025, setting a record; by the third quarter of 2026, it is already the highest revenue source within corporate and investment banking, becoming one of the core revenue streams for the group.

JPMorgan is moving its core payment track onto the blockchain, aiming for automated processing, 24/7 operation, and increased efficiency. Kinexys is at the center of this migration.

It serves as both an internal business unit and a key platform. It originated from a blockchain research group established in 2015 and was renamed Kinexys in November 2024.

Kinexys aims to build a "programmable, always-on" financial infrastructure. The goal is not limited to a single tokenized project but to enable deposits and assets to circulate on the same ledger around the clock, settling automatically based on preset conditions.

It integrates blockchain-based payments, asset tokenization, and service capabilities developed through Liink and Kinexys Labs on private and public chain networks.

BDA: 24/7 Settlement Deposit Accounts

Kinexys's main service is the Blockchain Deposit Account (BDA). It is an on-chain deposit account operated by JPMorgan, allowing companies to allocate and settle funds around the clock without being restricted by bank operating hours.

This is made possible by the ledger structure. Transfers between BDAs only change the balances within JPMorgan's same ledger, allowing for instant settlement, even at night and on weekends, without waiting for banks to open. BDAs also support programmable payments, automatically transferring funds when conditions are met, and support on-chain foreign exchange.

Payment company EBANX is a typical example.

Using Kinexys's BDA, EBANX transfers funds between accounts in about 20 countries, reducing the time from over a day (due to processing times and intermediaries) to just a few minutes.

Since settlements are completed in real-time within JPMorgan's ledger, EBANX can confirm receipt regardless of the time zone, thus reducing the amount of standby funds in each account.

According to a report released by Kinexys in 2025 in collaboration with the MIT Digital Currency Initiative, the BDA was processing over $1 billion daily at that time. Kinexys's total daily transaction volume exceeded $2 billion, meaning that the BDA alone accounted for half of it, making it a major contributor.

Since then, JPMorgan has not separately disclosed BDA data, but Kinexys's total transaction volume has steadily increased. The average daily transaction volume rose from over $5 billion in 2025 to about $7 billion in July 2026. Assuming the BDA still accounts for half of the total volume, as it did in January 2025, the current estimated daily transaction volume for the BDA is about $3.5 billion.

Even including repurchases, these numbers are still relatively small compared to JPMorgan's overall payment volume. Kinexys's total daily transaction volume of $7 billion accounts for about 0.06% of the daily payment business volume (approximately $12 trillion); the estimated $3.5 billion from the BDA accounts for about 0.03%.

The BDA is a commercial service, and real corporate funds are already flowing through it. However, compared to JPMorgan's overall payment volume, it is still in its early stages, primarily used by a limited number of companies to transfer funds between their entities. The continuous growth in transaction volume indicates that this service is indeed useful.

JPM Coin: Deposits on Public Chains, Almost No Users

JPM Coin (JPMD) turns BDA deposits into tokens on the public chain. The goal is to enable deposits that could only be used between JPMorgan clients to be utilized on a blockchain outside the bank.

The company issues JPM Coin from BDA balances, using it to pay for transactions on Base or Ethereum, and then converts the tokens back to BDA for accounting. However, ownership is restricted, and only wallets approved by JPMorgan can hold them.

JPMorgan's goal is to settle public chain transactions directly using bank deposits.

Before this, institutions wanting to pay in USD on public chains mostly had to use stablecoins. B2C2, which participated in testing when it launched, expected JPM Coin to provide "real-time on-chain settlement under regulated USD deposit protection," which is also the reason. However, JPMorgan has not quantified the cost savings from this.

On-chain data shows the issuance and usage of JPMD as follows:

Base: Since its first issuance in June 2025, there have only been 48 transfers, and none after February 20, 2026. As of November 3, the outstanding supply was about $1 million, accounting for about 0.02% of the USDC supply on the same chain (approximately $4.3 billion).

Ethereum: The later Ethereum version did not issue any tokens, and aside from the initial test participants, no actual users have been identified.

Contrary to expectations, JPM Coin was issued between 2025 and 2026 but has seen almost no real usage. However, the BDA took about three years to establish real use cases, and JPM Coin is still in its early stages, with broader adoption likely starting in early 2027.

Intraday Repurchase: A Borrowing Rate Drop of 56% for One Institution

Digital Financing is an intraday repurchase service that allows institutions to use government bonds as collateral to borrow money for a few hours.

Banks and brokerage firms sometimes only need funds for a few hours during the day to fulfill payment obligations. Digital Financing allows them to obtain short-term funds at rates lower than bank intraday credit limits.

The borrower presents tokenized government bonds, while the lender provides tokenized cash, and both parties exchange simultaneously at the agreed time. Because the maturity time can be precise to the minute, the borrower only pays interest for the actual usage time, with cash settled through the BDA.

This reduces borrowing costs. According to JPMorgan's case study, a global financial institution replaced bank intraday credit with Digital Financing, resulting in a 56% drop in borrowing rates.

The problem is that it is difficult to verify whether this service is still being used at that scale. JPMorgan reported in 2022 that since the service launched in November 2020, the cumulative repurchase volume exceeded $430 billion, but no repurchase data has been disclosed since then.

Competitor Broadridge's blockchain repurchase platform, DLR, had an average daily transaction volume of $35.9 billion as of September 2026. Even comparing with JPMorgan's 2022 figures, DLR's daily transaction volume exceeded half of JPMorgan's cumulative amount at that time, indicating a significant scale gap.

ICMA also listed DLR and Kinexys as blockchain repurchase platforms that have reached commercial scale, while assessing JPMorgan's overall market impact as still limited.

Tokenized Funds: $800 Million in Two Months, Eyeing Stablecoin Reserves

These tokenized funds convert shares of JPMorgan Asset Management's money market fund (MMF) into tokens on the public chain. The purpose is to bring institutional funds on the public chain into JPMorgan's funds.

Stablecoin issuers are the main institutions holding large amounts of funds on public chains. For every $1 stablecoin issued, the issuer must hold $1 in safe assets like government bonds as reserves, and many issuers deposit reserves into MMFs to earn interest.

The issue lies in the time difference. Stablecoin holders can request redemption for USD on-chain on Saturday nights, but ordinary MMF shares are just records on the fund manager's ledger, which can only be sold or transferred when the market opens on Monday.

The tokenized fund retains this ledger while issuing an equal amount of tokens on the blockchain, with Kinexys maintaining synchronization between the ledger and token supply. As a result, issuers can hold MMF tokens as reserves to earn interest and can transfer them on-chain immediately when needed, even at night and on weekends.

However, on-chain token transfers do not necessarily equate to immediate cash redemption or instant transfer of legal ownership, as the legal ownership of fund shares follows the fund investors' ledger.

JLTXX, launched by JPMorgan in May 2026, also targets this demand, designed for stablecoin issuers under the GENIUS Act. The prospectus states that stablecoin issuers are expected to hold shares of this fund as part or all of their reserve assets.

JLTXX was initiated with a $100 million investment from JPMorgan, and by the end of July, two months later, its net assets had grown to $800 million, according to SEC filings. As of November 3, the total on-chain supply on Ethereum and Solana was approximately 795 million tokens.

The buyers of JLTXX are unnamed. SEC filings as of the end of September show that banks and other deposit institutions hold about 84% of the registered shares, while non-financial companies hold about 16%. Combined with the design purpose stated in the prospectus, this money likely comes from stablecoin issuers or banks holding their reserves.

JLTXX's rapid growth does not mean it has clearly outpaced the market. As of the end of September, according to rwa.xyz, JLTXX ($628.5 million) and competitor Franklin Templeton's on-chain fund ($668 million) are of similar size, still far behind BlackRock's BUIDL (approximately $2.08 billion).

However, the market targeted by JLTXX is just beginning to grow.

U.S. Treasury Secretary Yellen predicts that the stablecoin market is currently about $300 billion and could grow tenfold under the GENIUS Act by 2030. Many issuers have also deposited significant amounts into MMFs. As of the end of September, USDC issuer Circle had placed about $62.5 billion, approximately 84% of its reserves, in a dedicated government MMF, about 80 times the current size of JLTXX.

If JLTXX can secure reserve mandates from stablecoin issuers one by one, its scale could grow to dozens of times its current size.

However, the stablecoin market was about $295.5 billion in November, roughly the same as a year ago, and it remains uncertain when this prediction will materialize.

Kinexys's Ten Years: The Next Lesson for Financial Institutions

JPMorgan has invested over a decade at the company level, from the blockchain research group in 2015 to Onyx, and now to Kinexys.

Backed by an annual technology budget of over $15 billion, it has fully integrated blockchain into the core infrastructure of its payment business.

CEO Jamie Dimon publicly acknowledged on Investor Day that "we have spent too much on this," indicating that JPMorgan's investment far exceeds basic research and development. This sustained resource investment clearly distinguishes it from other financial institutions.

In 2026, JPMorgan emphasized a new direction, stating, "We need to launch our own blockchain technology" to compete with new rivals. It also stated that blockchain would ultimately replace traditional financial infrastructure and expand actual services through Kinexys, including crypto-backed loans and public chain MMFs.

Over the past decade, Kinexys has provided a clear strategic lesson for traditional institutions adapting to changes in financial infrastructure.

It is not about creating a new chain without a clear purpose, nor launching independent services with little substance. JPMorgan starts from the advantages of its core business: existing payment clients processing $12 trillion daily for them and its deposit ledger.

It first uses the BDA to demonstrate the efficiency of internal infrastructure, including 24/7 real-time settlement and transfers between related entities, and then gradually expands into the on-chain market through products like JLTXX.

Many financial institutions face pressure to deliver quick results. However, JPMorgan's blockchain business has been in operation for over a decade, relying on its deposit ledger, liquidity, and existing payment clients. The lesson for institutions developing blockchain strategies is to expand from existing advantages using practical use cases.