JPMorgan Chase to Accept Bitcoin ETFs as Loan Collateral
JPMorgan Chase is planning to allow its clients to use cryptocurrency-backed assets, such as Bitcoin (BTC) exchange-traded funds (ETFs), as collateral for loans. The initiative will begin with BlackRock’s iShares Bitcoin Trust (IBIT), according to a recent report.
JPMorgan Embraces Bitcoin ETFs for Loan Collateral
The financial giant will soon permit its wealth management and trading clients to leverage crypto-linked assets, including crypto ETFs, as collateral for loans. This move signifies a growing acceptance of digital assets within traditional finance.
The initial offering will focus on BlackRock’s iShares Bitcoin Trust (IBIT), with implementation expected within weeks. JPMorgan plans to incorporate additional crypto ETFs after the initial rollout.
BlackRock’s IBIT is a dominant force in the Bitcoin ETF market, boasting $70.16 billion in assets under management (AUM) since its launch in January 2024. The fund accounts for over half of the $128.13 billion held across all U.S. spot Bitcoin ETFs, according to data from SoSoValue.
Furthermore, JPMorgan will now consider clients’ cryptocurrency holdings when assessing their overall net worth and liquid assets. These changes will apply to all JPMorgan clients globally, regardless of their wealth level.
Previously, JPMorgan accepted crypto ETFs as collateral for select clients on a limited, case-by-case basis. This new policy represents a significant expansion of their crypto-related services.
This decision reflects a broader trend of mainstream financial institutions embracing cryptocurrencies as demand for digital assets increases. It also aligns with JPMorgan CEO Jamie Dimon’s statement in May, indicating that the bank would soon enable clients to purchase Bitcoin.
JPMorgan is poised to become one of the largest traditional financial institutions to offer clients access to Bitcoin-related services. Other firms, such as Standard Chartered, have also introduced digital asset trading services through partnerships. Morgan Stanley is reportedly planning to add crypto trading to its E*Trade platform.
In related news, U.S. spot Bitcoin ETFs rebounded from three consecutive days of outflows, recording inflows of $378 million on Tuesday, according to SoSoValue data.
- JPMorgan Chase plans to allow clients to use crypto ETFs as loan collateral, starting with BlackRock’s IBIT.
- The bank will also consider clients’ crypto holdings when determining their total net worth.
- U.S. spot Bitcoin ETFs saw inflows of $378 million on Tuesday, ending a three-day streak of outflows.
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