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DealBook Briefing: JPMorgan Has Its Own Cryptocurrency



Say hello to JPM Coin JPMorgan Chase this morning announced the first cryptocurrency to be rolled out by a major U.S. bank. How will it be used? The new tokens, each of which represents a U.S. dollar, will help settle some payments between the bank’s clients. CNBC reports that the new digital coin will enter testing “in a few months.” It will facilitate a “tiny fraction” of its wholesale payments business. What’s the point? “Money sloshes back and forth all over the world in a large enterprise,” Umar Farooq, the head of JPMorgan’s blockchain projects, told CNBC. “Is there a way to ensure that a subsidiary can represent cash on the balance sheet without having to actually wire it to the unit? That way, they can consolidate their money and probably get better rates for it.” It also gives JPMorgan first-mover advantage. This will be one of the world’s first real-world crypto applications for banking, and the biggest move into the sector yet by an American lender. It also sets the bank up for a future in which crypto could be an integral part of the financial sector. he bank has come a long way on crypto. Its C.E.O., Jamie Dimon, famously declared Bitcoin a “fraud” in 2017 and said he would fire any employee caught trading it. (He later regretted his comments and added that he believed in the value of blockchain, the technology behind cryptocurrencies.) The threat of a government shutdown fades Congress is expected to vote on a bipartisan border deal this evening that would ward off another government shutdown. President Trump may be resigned to signing it. “I don’t want to see a shutdown,” he told reporters yesterday. “A shutdown would be a terrible thing.” A lot of people need to be persuaded. Congressional leaders acknowledged that the bill doesn’t allow for the wall that Mr. Trump and his allies want. (White House aides spent yesterday pitching the legislation to the likes of Lou Dobbs and Sean Hannity.) But it assigns more money to border fencing and immigration detention than left-wing Democrats would like. Still, no one sees a better option. “As with all compromises, I say to people, ‘Support the bill for what is in it,’ ” Speaker Nancy Pelosi told reporters yesterday. The Senate majority leader, Mitch McConnell, warned his colleagues against letting “unrelated cynical partisan plays get in the way of finishing this important process.” It’s not done until Mr. Trump puts pen to paper. CNN reminds us that he backed out of a previous compromise at the last minute, triggering the longest-ever government shutdown. This time, he could try to find further border funding from elsewhere in the government to claim some sort of victory. The U.S.-China trade talks get serious After three days of what Reuters calls “deputy-level meetings” in China, Treasury Secretary Steven Mnuchin and the U.S. trade representative, Robert Lighthizer, will embark on high-level trade negotiations in Beijing today. China is stepping up. The U.S. officials will meet today with Vice Premier Liu He, President Xi Jinping’s top economic adviser. According to the South China Morning Post, Mr. Xi himself may attend tomorrow. So far, it’s unclear what progress is being made. President Trump has said only that discussions are “going well,” adding that Chinese negotiators were “showing us tremendous respect.” Beijing has offered few details. But a deadline extension could help. America is scheduled to increase tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent if a deal isn’t reached by March 1. Mr. Trump has said he might let that slide; Bloomberg puts the possible deadline extension at 60 days. Europe fights the U.S. over ‘dirty money’ Relations between Washington and Brussels soured yesterday after the E.U. added four American territories to a blacklist of money-laundering regions, Jack Ewing and Alan Rappeport of the NYT write. On the list: Puerto Rico, American Samoa, Guam and the U.S. Virgin Islands joined an ignominious group that includes North Korea, Libya, Yemen and Saudi Arabia. European banks must apply greater scrutiny to any transactions in those areas.