U.S. banking giant J.P. Morgan Chase has apparently added Gemini and Coinbase as its first cryptocurrency exchange customers, the Wall Street Journal reported on 12 May.
Citing unnamed sources familiar with the matter, the news outlet highlighted that this was the first time that the U.S. bank has taken on clients from the crypto industry, though later in the day the CEO of TokenSoft, Mason Borda, said on Twitter that his firm has had an account in the bank since 2017. Apparently both exchanges accounts were accepted in April, and are just now starting to process transactions.
The bank will provide both Gemini and Coinbase U.S. users with deposits and withdrawals through wire transfer and Automated Clearing House (ACH) transactions. J.P. Morgan, however, will only provide cash-management services and handle dollar transactions, it will not process Bitcoin or other crypto transactions.
Both companies have also gone through several high-level security evaluations in the past. In January the Winklevoss twins’ exchange obtained a Service Organization Control (SOC) 2 Type 2 evaluation, and later in April secured a SOC 1 Type 1 certification, after passing a review by accounting firm Deloitte.
Coinbase, on the other hand, obtained both SOC 1 Type 2 and SOC 2 Type 2 evaluations in February, after passing review by accounting firm Grant Thornton. Coinbase owns the New York BitLicense, while Gemini has the Trust License from the NYDFS. Both exchanges have been licensed as money transmitters in multiple states.
J.P. Morgan has been working on a blockchain settlement service for a while now, with the aim to speed up and improve inter-company remittance. Last year, the company conducted client trials of its “JPM Coin”, after customers from Europe, Japan, and the U.S. showed interest in the technology.
Update: This article was modified to correct for the fact that Gemini has the Trust License from the NYDFS, not the New York BitLicense.