News

JPMorgan Looks to Merge Quorum With Ethereum Development Studio ConsenSys

0

On February 11, 2020, Reuters reported that the banking giant JPMorgan’s blockchain unit “Quorum” and Joseph Lubin’s Ethereum accelerator “ConsenSys” are discussing a merger.

Quorum was launched by JPMorgan back in 2016 and operates as an open-source blockchain that brings together the innovation of the ETH community with enhancements to support enterprise necessities. JPMorgan currently employs a team of around 25 people in its Quorum blockchain unit.

Not only is Quorum built on the ETH blockchain, but JPMorgan’s JPM Coin runs on top of Quorum as a stablecoin facilitating instant payments between institutional accounts.

According to the report, it’s still unclear whether the Quorum team will join ConsenSys after the merger. Furthermore, it’s unlikely that a formal deal will be announced any time soon as talks are still ongoing. 

Traditional Financial Institutions Merging With Fintech Companies 

The imminent partnership between JPMorgan and ConsenSys would mark a massive change in a steadily shifting sector, where more financial institutions are buying or merging with fintech startups.

Just last month, Visa entered a deal to buy Plaid, a startup that enables apps like Venmo and Square Cash quick access to financial accounts.

Let’s also not forget that when Bitcoin came onto the scene, it was instantly dismissed by many traditional banking institutions. In fact, JPMorgan CEO Jamie Dimon was among its biggest critics, continually calling Bitcoin “a fraud”.

However, as the blockchain that powers BTC transactions began to demonstrate its advantageous qualities, banks began to scramble to get on board the blockchain trend. 

JPMorgan became caught up in patent race amongst traditional banks, with Bank of America leading the charge by filing 50 blockchain patents in 2018 alone.

The JPMorgan Quorum blockchain unit is currently running the Interbank Information Network, a payments network involving over 300 global banks. 

Partnership Expected to Boost the Failing Quorum Blockchain 

As the largest bank in the U.S. by assets, JPMorgan merging its blockchain unit with the Ethereum co-founder Lubin’s blockchain startup is massive.

According to the Reuters report, JPMorgan has been considering either “spinning off” Quorum or merging it for at least two years now. However, the idea is to keep the Quorum brand alive and the technology open source even after the merger.

Crypto researcher Larry Cermak argues that Quorum struggles with its association with JPMorgan and is not getting adopted as much as it would have wanted. 

Now, with the partnership with ConsenSys, it would be a separate, almost independent, entity and ConsenSys would not have to burn massive amounts of cash

Wayne Jones
Wayne is a Blockchain enthusiast and expert in crypto trading. Currently, I cover trendy issues on digital currencies.

Tezos the Coin to Beat as Altcoins Season Grows alongside Bitcoin

Previous article

BlockFyre Coin Research: Lition

Next article

Comments

Leave a reply

You may also like

More in News