JPMorgan Chase (JPM), the largest U.S. commercial bank, says it plans to let institutional clients use their Bitcoin (BTC) and Ethereum (ETH) holdings as loan collateral.
The ability for large institutional clients to put up cryptocurrencies for loans is expected to go into effect by year’s end, according to the bank.
The tokens pledged under the worldwide program will be safeguarded by a third-party custodian, said JPMorgan Chase.
This latest move builds on JPMorgan’s earlier change that allows client to pledge crypto-linked exchange-traded funds (ETFs) as loan collateral.
Analysts say this development at JPMorgan Chase is indicative of the rapidly growing integration of digital assets into Wall Street’s lending practices.
With regulations around digital assets easing in the U.S., leading banks such as JPMorgan are shifting from skepticism to actively incorporating crypto into their financial services.
Other U.S. banks and investment firms, including Morgan Stanley (MS) and Fidelity, are also enhancing their cryptocurrency offerings for both individual and institutional clients.
JPMorgan Chase CEO Jamie Dimon has long been a prominent crypto skeptic but said earlier this year that the bank has to respond to customer demands.
JPM stock has risen 23% this year to trade at $294.54 U.S. per share.
