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JPMorgan Chase & Co. is preparing to let some of its largest clients post Bitcoin and Ethereum as collateral for loans, in a step that could reshape how Wall Street treats digital assets. The plan, detailed in a Bloomberg report released before Friday’s opening bell, is expected to go live before the end of 2025.
A third-party custodian will hold any pledged tokens, keeping them outside the bank’s direct control. That safeguard mirrors JPMorgan’s policy for other digital-asset products and helps limit regulatory exposure. Shares of the bank edged 0.18 percent higher in pre-market trading to $294.93, a modest uptick that reflected early investor reaction.
The proposal extends JPMorgan’s earlier policy of accepting crypto-linked exchange-traded funds as collateral. Allowing borrowers to use the coins themselves moves digital assets closer to the status of more conventional instruments such as Treasuries or gold, though price swings remain far greater.
Bitcoin’s record surge this year, combined with a lighter regulatory climate, has encouraged U.S. lenders to reassess their approach to digital assets. For banks once skeptical of crypto’s place in finance, integration now appears inevitable rather than optional.
Under the new framework, clients would be able to pledge crypto held by an approved custodian against structured loans or revolving credit facilities. The arrangement allows borrowers to raise cash without selling their holdings, while lenders manage exposure through independent custody and risk controls.
JPMorgan’s initiative follows a string of similar efforts across the industry. Morgan Stanley, State Street, Fidelity, and BNY Mellon have all expanded their digital-asset divisions in recent months. Some are testing tokenized money-market products; others are adding direct trading or custody options for institutional and retail clients.
In July, BNY Mellon partnered with Goldman Sachs to launch a tokenized money-market fund for institutions, building on the custody services first introduced in 2021. A month later, Morgan Stanley confirmed plans to enable trading of Bitcoin, Ethereum, and Solana on its E\*TRADE platform by mid-2026, as part of a wider effort to relax restrictions on crypto investment accounts.
Analysts view this activity as part of a gradual realignment within U.S. banking. Firms are preparing for eventual federal guidelines while seeking early ground in a market that is steadily gaining regulatory clarity.
Chief Executive Jamie Dimon, once one of crypto’s fiercest critics, has softened his tone. He long branded Bitcoin a “fraud” and “pet rock,” claiming it enabled illicit trade. Early this year, his remarks were more nuanced: “I don’t think we should smoke, but I defend your right to smoke. I defend your right to buy Bitcoin; go at it.”
The increasing use of blockchain technology within the organization is what is behind the rhetorical change. JPMorgan has launched the J.P. Morgan Deposit Token as a payment option using blockchain technology, rather than stablecoins. The bank's Kinexys network has been expanded to process over $2 billion per day in transactions involving carbon trading, supply-chain finance, and cross-border settlement.
If the bank integrated crypto as collateral, it could classify digital assets in the same way as government securities and equities for structured lending. However, the move would also raise issues of valuation, custody, and regulatory oversight, which are all new challenges banking institutions will need to manage as they gradually incorporate blockchain into conventional finance.
At this stage, one question looms over the entire industry: will digital assets be treated like gold or Treasuries were in the past, that is, as ordinary in credit markets?
JPMorgan’s acceptance of Bitcoin and Ethereum as loan collateral signals a shift in banks' perception of digital assets. As more institutions follow this path, the line between traditional finance and crypto innovation becomes more indistinct, thus preparing for broader market adoption.
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