Overview
- Bloomberg reported that JPMorgan plans to allow institutional clients to use Bitcoin and Ether as collateral for loans by the end of 2025.
- Under the global program, pledged tokens would be safeguarded by independent custodians rather than held on the bank’s balance sheet.
- The initiative builds on JPMorgan’s recent acceptance of crypto-linked ETFs as collateral and revives a crypto-backed lending effort paused in 2022.
- Using crypto as collateral would let clients borrow without selling holdings, though details on haircuts, margining and risk controls have not been disclosed.
- Rival firms including Morgan Stanley, State Street, BNY Mellon and Fidelity are expanding crypto services as strong prices and clearer U.S. policy encourage bank adoption.