JP Morgan Partners with Siemens to Develop a Distributed Ledger Technology (DLT) Payment System for It
JP Morgan Chase, the largest bank in the United States, collaborates with Siemens to develop a blockchain-based payment system.
According to the Financial Times, American banking giant JP Morgan has partnered with German industrial giant Siemens to develop a blockchain-based payment system for the latter.
Siemens has claimed that it is experiencing a significantly increased payment burden now that it is using pay-per-use payment mechanisms, which are gaining popularity. As a result, the urge exists to experiment with and implement the emerging blockchain technology upon which Bitcoin and other cryptocurrencies are constructed.
Additionally, a Siemens representative told the Financial Times, new digital business models are developing and the established ones are starting to struggle to compete.
Siemens will use the new blockchain technology to automate the transfer of funds between its bank accounts. Currently, these money are sent in USD, but the firm hopes to begin processing payments in EUR next year. Siemens made no remark on the number of payments that the new blockchain system would have to handle.
Siemens is JP Morgan’s first client for the new technology.
Onyx, a subsidiary of JP Morgan, developed the new DLT payment processing technology. According to JPM, a queue of clients has formed to test the new payment mechanism. However, the financial behemoth has chosen to employ it first.
Banks are beginning to incorporate DLT directly into their operations, since they seem to believe in blockchain far more than in cryptocurrency. Wells Fargo and HSBC agreed last week to settle currency deals directly on DLT.