JPMorgan set to allow loans backed by Bitcoin and Ethereum: FT

• JPMorgan Chase is reportedly exploring lending against cryptocurrency holdings.
• The initiative will permit clients to borrow against Bitcoin and Ethereum beginning next year.
• The move follows earlier remarks from CEO Jamie Dimon that the bank plans to join the stablecoin race.

JPMorgan is reportedly planning to launch lending initiatives that allow clients to borrow using their cryptocurrency holdings as collateral, according to a Financial Times report on Tuesday.

JPMorgan plans crypto-backed lending initiative

JPMorgan Chase is reportedly planning to launch a lending service backed by clients' cryptocurrency holdings, including Bitcoin and Ethereum, according to a report from the Financial Times on Tuesday, citing sources familiar with the matter.

The report mentioned that JPMorgan could roll out the new initiative next year — although it is still subject to change. JPMorgan was previously reported to be exploring plans to offer loans secured by crypto exchange-traded funds (ETF), starting with BlackRock's iShares Bitcoin Trust. The report noted that lending against the actual assets would be a further step.

The move would represent a U-turn for JPMorgan's CEO, Jamie Dimon, who has long been a skeptic of Bitcoin. Dimon had previously announced that the bank would allow clients to purchase Bitcoin, although he remains critical of the digital asset.

Dimon also announced last week that the bank plans to enter the stablecoin market with a "limited-use" stablecoin primarily for institutional clients. He stated that he still didn't see how they are a better solution to fiat payments, reinforcing his skepticism about crypto.

The report further noted that for JPMorgan to offer loans backed directly by cryptocurrencies, "it would need to resolve the technical issue of how to handle crypto seized from customers who failed to repay their loans."

Since JPMorgan, like most US banks, does not hold digital assets on its balance sheet, it would likely engage a third-party custodian, such as Coinbase, to manage the collateral securely.

JPMorgan's shift toward crypto comes as more banks engage with digital assets, including Morgan Stanley, which is reportedly planning to launch crypto trading through its E*Trade platform.

The shift also aligns with progress in crypto regulation in the US. President Donald Trump signed the GENIUS Act on Friday, which introduces a federal framework requiring stablecoin issuers to hold equivalent US Dollar-backed reserves, undergo annual audits, and comply with rules applicable to foreign entities.

This comes after the House of Representatives passed the Crypto Market Structure CLARITY bill last week, which now heads over to the Senate for final deliberation.