JPMorgan Chase accepts Bitcoin and Ethereum as loan collateral

JPMorgan Chase has expanded its financial services by allowing institutional clients to use Bitcoin and Ethereum as collateral for U.S. dollar loans. Launched through the bank’s Kinexys digital assets platform, the program enables clients to access liquidity without selling their cryptocurrency holdings.

To manage the inherent volatility of digital assets, the bank applies significant haircuts of 30% to 50% on crypto collateral. For example, $100,000 in Bitcoin may secure between $50,000 and $70,000 in financing. The assets are held by third-party custodians, such as Coinbase Custody and Fidelity Digital Assets, rather than being moved onto the bank’s own balance sheet. Real-time valuation monitoring is supported by Chainlink oracle feeds.

This move marks a strategic shift for the institution, as CEO Jamie Dimon has historically been a vocal critic of cryptocurrencies. Separately, the bank is seeing significant market momentum, with its valuation approaching a $1 trillion market capitalization following record quarterly profits and a robust expansion strategy that includes new physical branches, such as a recent flagship opening in Chicago.