JPMorgan Chase (NASDAQ:JPM) is preparing to allow clients in its trading and wealth management divisions to use certain cryptocurrency-related assets, specifically Bitcoin (CRYPTO: BTC) ETFs, as collateral for loans.
What Happened: Quoting unnamed sources, Bloomberg reported that the bank will initially begin offering financing backed by BlackRock's iShares Bitcoin Trust (NASDAQ:IBIT).
The change marks a significant policy adjustment as traditional financial institutions respond to regulatory shifts and growing client demand following the election of President Donald Trump, whose administration has taken a notably pro-crypto stance.
In addition to accepting Bitcoin ETFs for lending purposes, JPMorgan also intends to factor clients' crypto holdings into wealth assessments.
The inclusion would place cryptocurrencies alongside more traditional assets such as equities, real estate, or collectibles in determining a client's borrowable value.
Though JPMorgan has declined to comment publicly on the developments, the move would build on its existing ties to the crypto space.
The bank has long served clients like Coinbase (NASDAQ:COIN) and was among the earliest financial giants to deploy blockchain-based payment services.
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Why It Matters: Despite CEO Jamie Dimon‘s personal skepticism--he has said he's "not a fan" of Bitcoin--he has expressed support for client autonomy in digital asset investing.
"I don't think we should smoke, but I defend your right to smoke," he said in May. "I defend your right to buy Bitcoin, go at it."
The new lending framework is expected to be rolled out across JPMorgan's global wealth management segments, encompassing all client tiers, from everyday investors to high-net-worth individuals.
Previously, crypto ETFs were considered as loan collateral only in isolated cases.
Spot Bitcoin ETFs, introduced in the U.S. in January 2024, have since grown rapidly to manage over $128 billion in assets, ranking among the most successful ETF launches on record.
Meanwhile, Bitcoin's price has surged, hitting a peak of $111,980 in May, bolstered by Trump's election victory in November and his administration's crypto-friendly policies.
Industry donations have played a role in reshaping Washington's stance on digital assets, with Trump advocating several pro-crypto measures since taking office.
His own family businesses have expanded into crypto ventures, including Bitcoin mining operations and memecoin initiatives, further signaling the asset class's growing political and financial influence.
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